Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Feb. 23, 2024 | Jun. 30, 2023 | |
Document and Entity Information | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2023 | ||
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 | C/O Theravance Biopharma US, Inc. | ||
Entity Address, Address Line Two | 901 Gateway Boulevard | ||
Entity Address, City or Town | South San Francisco | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 94080 | ||
City Area Code | 650 | ||
Local Phone Number | 808-6000 | ||
Title of 12(b) Security | Ordinary Share $0.00001 Par Value | ||
Trading Symbol | TBPH | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | false | ||
Document Financial Statement Error Correction [Flag] | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 458.8 | ||
Entity Common Stock, Shares Outstanding | 48,164,708 | ||
Auditor Firm ID | 42 | ||
Auditor Name | Ernst & Young LLP | ||
Auditor Location | San Mateo, California | ||
Entity Central Index Key | 0001583107 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2023 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 39,545 | $ 298,172 |
Short-term marketable securities | 62,881 | 29,312 |
Receivables from collaborative arrangements | 17,474 | 16,785 |
Prepaid clinical and development services | 2,038 | 1,513 |
Other prepaid and current assets | 11,603 | 7,682 |
Total current assets | 133,541 | 353,464 |
Property and equipment, net | 9,068 | 11,875 |
Operating lease assets | 36,287 | 40,126 |
Future contingent milestone and royalty assets | 194,200 | 194,200 |
Restricted cash | 836 | 836 |
Other assets | 8,067 | 6,899 |
Total assets | 381,999 | 607,400 |
Current liabilities: | ||
Accounts payable | 1,524 | 1,554 |
Accrued personnel-related expenses | 6,443 | 10,314 |
Accrued clinical and development expenses | 2,246 | 4,932 |
Accrued general and administrative expenses | 2,900 | 4,020 |
Operating lease liabilities | 3,923 | 6,753 |
Tenant improvement payable to subleasee | 6,490 | |
Other accrued liabilities | 1,241 | 1,142 |
Total current liabilities | 24,767 | 28,715 |
Long-term operating lease liabilities | 45,236 | 45,407 |
Future royalty payment contingency | 27,788 | 25,438 |
Long-term deferred revenue | 192 | |
Unrecognized tax benefits | 65,294 | 64,191 |
Other long-term liabilities | 5,919 | 1,657 |
Commitments and contingencies | ||
Shareholders' Equity | ||
Preferred shares, $0.00001 par value: 230 shares authorized, no shares issued or outstanding | ||
Ordinary shares, $0.00001 par value: 200,000 shares authorized; 48,091 and 65,227 shares issued and outstanding at December 31, 2023 and December 31, 2022, respectively | 1 | |
Additional paid-in capital | 1,122,164 | 1,295,725 |
Accumulated other comprehensive loss | (65) | (15) |
Accumulated deficit | (909,104) | (853,911) |
Total shareholders' equity | 212,995 | 441,800 |
Total liabilities and shareholders' equity | $ 381,999 | $ 607,400 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
CONSOLIDATED BALANCE SHEETS | ||
Preferred shares, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Preferred shares, shares authorized (in shares) | 230 | 230 |
Preferred shares, shares issued (in shares) | 0 | 0 |
Preferred shares, outstanding shares (in shares) | 0 | 0 |
Ordinary shares, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Ordinary shares, authorized shares (in shares) | 200,000 | 200,000 |
Ordinary shares, shares issued (in shares) | 48,091 | 65,227 |
Ordinary shares, shares outstanding (in shares) | 48,091 | 65,227 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | ||
Revenue: | |||
Total revenue | $ 57,424,000 | $ 51,346,000 | |
Expenses: | |||
Research and development | [1] | 40,621,000 | 63,392,000 |
Selling, general and administrative | [1] | 70,095,000 | 67,073,000 |
Restructuring and related expenses | [1] | 2,743,000 | 12,838,000 |
Total expenses | 113,459,000 | 143,303,000 | |
Loss from operations | (56,035,000) | (91,957,000) | |
Interest expense | [2] | (2,350,000) | (6,369,000) |
Loss on extinguishment of debt | (3,034,000) | ||
Interest income and other income (expense), net | 9,116,000 | 8,545,000 | |
Loss from continuing operations before income taxes | (49,269,000) | (92,815,000) | |
Provision for income tax expense | (5,924,000) | (9,000) | |
Net loss from continuing operations | (55,193,000) | (92,824,000) | |
Income from discontinued operations before income taxes | 1,143,930,000 | ||
Provision for income tax expense | (178,974,000) | ||
Net income from discontinued operations | 964,956,000 | ||
Net Income (Loss) | $ (55,193,000) | $ 872,132,000 | |
Net income (loss) per share: | |||
Continuing operations - basic (in dollars per share) | $ (1) | $ (1.26) | |
Continuing operations - diluted (in dollars per share) | (1) | (1.26) | |
Discontinued operations - basic (in dollars per share) | 13.11 | ||
Discontinued operations - diluted (in dollars per share) | 13.11 | ||
Net income (loss) - basic (in dollars per share) | (1) | 11.85 | |
Net income (loss) - diluted (in dollars per share) | $ (1) | $ 11.85 | |
Shares used to compute net income (loss) per share - basic | 55,303 | 73,591 | |
Shares used to compute net income (loss) per share - diluted | 55,303 | 73,591 | |
Viatris collaboration agreement | |||
Revenue: | |||
Total revenue | $ 57,201,000 | $ 48,624,000 | |
Viatris royalties (Non-US) | |||
Revenue: | |||
Total revenue | 7,000 | 30,000 | |
Collaboration revenue | |||
Revenue: | |||
Total revenue | $ 216,000 | 192,000 | |
Licensing revenue | |||
Revenue: | |||
Total revenue | $ 2,500,000 | ||
[1] Amounts include share-based compensation expense as follows: Interest expense for the year ended December 31, 2023 was comprised of non-cash interest expense only. |
CONSOLIDATED STATEMENTS OF OP_2
CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Total share-based compensation expense | $ 25,371 | $ 39,734 |
Research and development | ||
Total share-based compensation expense | 8,048 | 12,888 |
Selling, general and administrative | ||
Total share-based compensation expense | 16,966 | 19,848 |
Restructuring and related expenses | ||
Total share-based compensation expense | $ 357 | $ 6,998 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||
Net Income (Loss) | $ (55,193) | $ 872,132 |
Other comprehensive loss: | ||
Net unrealized loss on available-for-sale investments, net of tax | (50) | (15) |
Comprehensive income (loss) | $ (55,243) | $ 872,117 |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Ordinary Shares | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Accumulated Deficit | Total |
Balances at Dec. 31, 2021 | $ 1 | $ 1,387,469 | $ (1,726,043) | $ (338,573) | |
Balances (in shares) at Dec. 31, 2021 | 74,435 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Repurchase of ordinary shares, net of transaction costs | (128,830) | (128,830) | |||
Repurchase of ordinary shares, net of transaction costs (in shares) | (12,739) | ||||
Proceeds from ESPP purchases | 802 | 802 | |||
Proceeds from ESPP purchases (in shares) | 118 | ||||
Employee share-based compensation expense | 39,734 | 39,734 | |||
Issuance of restricted shares (in shares) | 3,764 | ||||
Repurchase of shares to satisfy tax withholding | (3,450) | (3,450) | |||
Repurchase of shares to satisfy tax withholding (in shares) | (351) | ||||
Net unrealized loss on marketable securities | $ (15) | (15) | |||
Net Income (Loss) | 872,132 | 872,132 | |||
Balances at Dec. 31, 2022 | $ 1 | 1,295,725 | (15) | (853,911) | $ 441,800 |
Balances (in shares) at Dec. 31, 2022 | 65,227 | 65,227 | |||
Increase (Decrease) in Stockholders' Equity | |||||
Repurchase of ordinary shares, net of transaction costs | $ (1) | (197,051) | $ (197,052) | ||
Repurchase of ordinary shares, net of transaction costs (in shares) | (18,634) | ||||
Proceeds from ESPP purchases | 619 | 619 | |||
Proceeds from ESPP purchases (in shares) | 86 | ||||
Employee share-based compensation expense | 25,371 | 25,371 | |||
Issuance of restricted shares (in shares) | 1,651 | ||||
Repurchase of shares to satisfy tax withholding | (2,500) | (2,500) | |||
Repurchase of shares to satisfy tax withholding (in shares) | (239) | ||||
Net unrealized loss on marketable securities | (50) | (50) | |||
Net Income (Loss) | (55,193) | (55,193) | |||
Balances at Dec. 31, 2023 | $ 1,122,164 | $ (65) | $ (909,104) | $ 212,995 | |
Balances (in shares) at Dec. 31, 2023 | 48,091 | 48,091 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Operating activities | ||
Net (loss) income | $ (55,193) | $ 872,132 |
Less: Net income from discontinued operations | (964,956) | |
Net loss from continuing operations | (55,193) | (92,824) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 2,001 | 3,716 |
Amortization and accretion income, net | (1,897) | (681) |
Future royalty payment contingency interest accretion | 2,350 | 974 |
Share-based compensation | 25,371 | 39,734 |
Gain on sale of Velusetrag | (2,709) | |
(Gain) loss on disposal of property and equipment | 1,352 | (8) |
Amortization of right-of-use assets | 4,152 | 3,989 |
Deferred income taxes | 3,207 | |
Loss on extinguishment of debt | 3,034 | |
Changes in operating assets and liabilities: | ||
Receivables from collaborative and licensing arrangements | (689) | (2,720) |
Prepaid clinical and development services | (526) | 8,733 |
Other prepaid and current assets | (3,921) | (704) |
Right-of-use lease assets | (314) | (4,424) |
Other assets | (1,233) | (3,802) |
Accounts payable | 6 | (1,612) |
Accrued personnel-related expenses, accrued clinical and development expenses, and other accrued liabilities | (7,095) | (14,086) |
Accrued interest payable | (1,246) | |
Deferred revenue | (216) | (192) |
Operating lease liabilities | (3,001) | (1,024) |
Unrecognized tax benefits | 1,102 | 63,952 |
Other long-term liabilities | 7,547 | (525) |
Net cash used in operating activities - continuing operations | (26,997) | (2,425) |
Net cash used in operating activities - discontinued operations | (184,566) | |
Net cash used in operating activities | (26,997) | (186,991) |
Investing activities | ||
Purchases of property and equipment | (2,488) | (572) |
Purchases of marketable securities | (134,534) | (103,145) |
Maturities of marketable securities | 31,435 | 158,000 |
Sale of short-term investments and marketable securities | 71,377 | 17 |
Proceeds from the sale of Velusetrag | 2,709 | |
Proceeds from the sale of property and equipment | 1,513 | 1,866 |
Net cash (used in) provided by investing activities - continuing operations | (32,697) | 58,875 |
Net cash provided by investing activities - discontinued operations | 1,095,134 | |
Net cash (used in) provided by investing activities | (32,697) | 1,154,009 |
Financing activities | ||
Ordinary share repurchases | (197,051) | (128,830) |
Proceeds from ampreloxetine funding, net | 24,464 | |
Proceeds from ESPP purchases | 618 | 802 |
Repurchase of shares to satisfy tax withholding | (2,500) | (3,450) |
Net cash used in financing activities - continuing operations | (198,933) | (738,617) |
Net cash used in financing activities - discontinued operations | (20,189) | |
Net cash used in financing activities | (198,933) | (758,806) |
Net (decrease) increase in cash, cash equivalents, and restricted cash | (258,627) | 208,212 |
Cash, cash equivalents, and restricted cash at beginning of period | 299,008 | 90,796 |
Cash, cash equivalents, and restricted cash at end of period | 40,381 | 299,008 |
Supplemental disclosure of cash flow information | ||
Cash paid for interest | 22,244 | |
Cash paid for income taxes, net | 24 | 117,966 |
Supplemental disclosure of non-cash investing and financing activities | ||
Recognition of tenant improvement allowance assigned to sublease | 6,838 | 8,900 |
Sublease | ||
Supplemental disclosure of non-cash investing and financing activities | ||
Recognition of tenant improvement allowance assigned to sublease | $ 6,490 | |
2035 notes | ||
Financing activities | ||
Principal payment on notes | (399,998) | |
2023 notes | ||
Financing activities | ||
Principal payment on notes | $ (231,605) |
Organization and Summary of Sig
Organization and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2023 | |
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 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, 2023 and 2022, and for the year ended December 31, 2023 and 2022 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. On July 20, 2022, the Company completed a monetization of its ownership interests in a significant equity method investment which had a major effect on the Company’s financial results for the year ended December 31, 2022 (see “ Note 9. Sale of Equity Interests in Theravance Respiratory Company, LLC and Discontinued Operations” Certain prior period amounts in the “Notes to Consolidated Financial Statements” have been reclassified. 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. Due to the inherent uncertainty in making estimates, actual results in future periods could differ materially from those estimates. Segment Reporting The Company has determined that its chief executive officer is the chief operating decision maker (“CODM”). A single management team reports to the CODM who comprehensively manages the entire business. The Company’s business offerings have similar economics and other characteristics, including the nature of products, types of customers, distribution methods, and regulatory environment. As a result, the Company has concluded that it operates in a single segment which is the development and commercialization of human therapeutics. 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 cost which approximates fair value due to their short-term nature. Restricted Cash “Note 5. Cash, Cash Equivalents, and Restricted Cash” Investments in Marketable Securities The Company invests in marketable securities, primarily commercial paper, corporate notes, US government bonds and US government agency bonds. Marketable debt securities with original maturities of greater than three months and remaining maturities of less than 12 months are considered short-term investments. Marketable debt securities with maturities greater than 12 months are considered long-term investments. The Company determines the appropriate classification of the marketable securities at the time they are acquired and evaluates the appropriateness of such classifications at each balance sheet date. 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. Unrealized gains and losses are included as a component of accumulated other comprehensive income (loss) in shareholders’ equity of the consolidated balance sheets and as a component of total comprehensive income (loss) in the consolidated statements of operations and comprehensive income (loss) . The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity, which is included as a component of 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). 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. 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 Fair Value of Financial Instruments The Company defines fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. ASC Topic 820, Fair Value Measurements and Disclosures Level 1 Level 2 Level 3 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 future contingent milestone and royalty assets and receivables primarily relate to amounts due under its collaboration and other 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, 2023 and 2022, the Company did not experience any losses related to its receivables. Property and Equipment Property, equipment, and leasehold improvements are stated at cost, net of accumulated depreciation, and are depreciated using the straight-line method over the estimated useful lives as presented in the table below. Upon retirement or sale, the cost of the disposed assets and the related accumulated depreciation are removed from the consolidated balance sheet and any resulting gain or loss is reflected in the consolidated statement of operations in the period realized. 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 over 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 at the commencement date of the leasing arrangement, 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 estimated 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. When combining lease and non-lease components, the Company would account for the lease and non-lease components Operating lease assets and operating lease liabilities are remeasured upon reassessment events and modifications to leases using the present value of remaining lease payments and incremental borrowing rate at the time of remeasurement, as applicable. Operating lease assets are evaluated for possible impairment in accordance with the Company’s long-lived assets policy. The Company recognizes variable lease payments as operating expenses in the period in which the obligation for those payments is incurred. Variable lease payments primarily include common area maintenance, utilities, real estate taxes, insurance, and other operating costs that are passed on from the lessor in proportion to the space leased by the Company. The Company has elected to 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 . Future Contingent Milestone and Royalty Assets The fair value of consideration received in connection with TRC Transaction in July 2022 (see “ Note 9. Sale of Equity Interests in Theravance Respiratory Company, LLC and Discontinued Operations” Future Royalty Payment Contingency Note 10. Ampreloxetine Funding” Impairment of Long-Lived Assets The Company regularly reviews long-lived assets, including operating lease assets, to determine whether indicators of impairment may exist. If indications of impairment exist, the Company performs a test of recoverability by comparing the estimated undiscounted future cash flows expected to result from the use of the asset over its useful life to the carrying value of the long-lived asset. If the carrying value of the long-lived asset exceeds such estimated undiscounted cash flows, the Company would determine the estimated fair value of the long-lived assets generally using the estimated discounted future cash flows to recognize an impairment loss on the long-lived asset. The Company did not recognize any impairment losses related to its long-lived assets for either the year ended December 31, 2023 or 2022. 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 facility costs, and fees paid to third parties that conduct certain clinical study 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 may accrue include: • fees paid to investigative sites in connection with clinical studies; • fees paid to contract manufacturing organizations (“CMOs”) in connection with the production of 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 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. Selling, General and Administrative Expenses Selling, general and administrative (“SG&A”) expenses are recorded in the period that services are rendered or goods are received. SG&A expenses consist primarily of salaries and benefits, facilities and overhead costs, and other costs related to areas such as legal, finance, information technology, sales and marketing, and medical affairs. Advertising expenses within selling, general and administrative expenses, including promotional expenses, were $5.1 million and $8.0 million for the year ended December 31, 2023 and 2022, respectively. Share-Based Compensation 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 to be 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 share 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: (i) the expected term of the options and ESPP purchases; (ii) the share’s expected dividend yield; (iii) the expected share price volatility; and (iv) the risk-free interest rate. The expected share price volatility is based on the historical volatility, and the risk-free interest rate is based on the US Treasury rate commensurate with the expected term of the associated award. The Company previously used the “simplified” method as described in Staff Accounting Bulletin No. 107, Share-Based Payment exercise data and transitioned to estimating the expected option term based on its historical option exercise behavior. The change in expected term methodology did not have a material impact to the financial statements. The Company may also issue performance-contingent RSUs that settle in the Company’s ordinary shares. The fair value of the performance-contingent RSUs is determined on the day of grant using the number of shares expected to be The Company may also issue market-based RSUs that settle in the Company’s ordinary shares. Market-based RSUs vest upon the Company’s shares meeting certain market-based price targets followed by a service period. The fair value of the market-based RSUs is determined using a Monte-Carlo valuation model. Share-based compensation expense is recognized over the requisite service period regardless of whether or not the market-based price targets are deemed probable, and the share-based compensation expense is not reversed solely because the market-based price target is not achieved. 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 gross unrecognized tax benefits associated with uncertain tax positions 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 Income (Loss) per Share and Anti-dilutive Securities Basic net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of shares outstanding during the period. Diluted net income (loss) per share is computed by increasing the weighted- average number of shares outstanding for the dilutive effect of potential ordinary shares determined using the treasury stock method. Potential ordinary shares include outstanding share options, ordinary shares expected to be issued under the Company’s ESPP, RSUs, and performance-contingent RSUs for which the performance or market vesting conditions have been deemed probable. Performance-contingent RSUs with performance or marketing vesting conditions that have been deemed not probable as of the end of the period are not included in the diluted net income (loss) per share computation. Year Ended December 31, (In thousands, except per share data) 2023 2022 Numerator: Net loss from continuing operations $ (55,193) $ (92,824) Net income from discontinued operations — 964,956 Net income (loss) (55,193) 872,132 Denominator: Weighted-average ordinary shares outstanding 55,303 73,591 Less: weighted-average ordinary shares subject to forfeiture — — Weighted-average ordinary shares outstanding - basic and diluted 55,303 73,591 Net income (loss) per share: Continuing operations - basic and diluted $ (1.00) $ (1.26) Discontinued operations - basic and diluted $ — $ 13.11 Net income (loss) per share - basic and diluted $ (1.00) $ 11.85 In accordance with ASC 260, Earnings Per Share Year Ended December 31, (In thousands) 2023 2022 Options 2,348 2,601 Restricted shares 1,523 2,851 Employee share purchase plan 45 35 Total 3,916 5,487 Comprehensive Income (Loss) Comprehensive income (loss) is comprised of net income (loss) and changes in unrealized gains and losses on the Company’s available-for-sale investments. Recently Issued Accounting Pronouncements Not Yet Adopted In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures The Company is evaluating the impact of adopting ASU 2023-09 on its consolidated financial statements income tax 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, 2023 | |
Revenue | |
Revenue | 2. Revenue Revenues from Collaborative Arrangements Viatris In January 2015, the Company and Viatris Inc. (“Viatris”) established a strategic collaboration (the “Viatris Agreement”) for the development and commercialization of revefenacin, including YUPELRI ® In the US, Viatris is leading the commercialization of YUPELRI, and the Company co-promotes the product under a profit and loss sharing arrangement (65% to Viatris; 35% to the Company). Outside the US (excluding China and adjacent territories), Viatris is responsible for development and commercialization and will pay the Company a tiered royalty on net sales at percentage royalty rates ranging from low double-digits to mid-teens. Viatris also holds exclusive development and commercialization rights to nebulized revefenacin in China and adjacent territories, which include the Hong Kong SAR, the Macau SAR, and Taiwan, and the Company is eligible to receive low double-digit tiered royalties on net sales of nebulized revefenacin in this region, if approved. Viatris is responsible for all aspects of development and commercialization in the China and adjacent territories, including pre- and post-launch activities and product registration and all associated costs. As of December 31, 2023, the Company is eligible to receive from Viatris potential global development, regulatory and sales milestone payments (excluding China and adjacent territories) up to $205.0 million in the aggregate, with $160.0 million associated with YUPELRI monotherapy and $45.0 million associated with future potential combination products. Of the $160.0 million associated with monotherapy, $150.0 million relates to sales milestones based on achieving certain levels of US net sales and $10.0 million relates to regulatory actions in the European Union (“EU”). The Company is also eligible to receive additional potential development and sales milestones up to $52.5 million related to Viatris’ development and commercialization of nebulized revefenacin in China and adjacent territories with $45.0 million associated with YUPELRI monotherapy and $7.5 million associated with future potential combination products. Of the $45.0 million associated with monotherapy, $37.5 million relates to sales milestones based on achieving certain levels of net sales and $7.5 million relates to regulatory approval in China. The Viatris Agreement is considered to be within the scope of ASC 808, Collaborative Arrangements Revenue Recognition The future potential milestone amounts for Following the 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 in the Company’s consolidated statements of operations: Year Ended December 31, (In thousands) 2023 2022 Viatris collaboration agreement – Amounts receivable from Viatris $ 57,201 $ 48,624 Viatris royalties (Non-US) 7 30 Total $ 57,208 $ 48,654 While Viatris records total YUPELRI net sales within its own consolidated financial statements, Viatris collaboration agreement revenue on the Company’s consolidated statements of operations included the Company’s implied 35% share of total YUPELRI net sales, before deducting shared expenses, as presented below: Year Ended December 31, (In thousands) 2023 2022 YUPELRI net sales (Theravance Biopharma implied 35%) $ 77,337 $ 70,653 Other Collaborative Arrangement Revenues The Company’s other collaborative arrangement revenues consisted of: Year Ended December 31, (In thousands) 2023 2022 Viatris $ 216 $ 24 Other — 168 Total collaboration revenue $ 216 $ 192 All of the recognized revenues from the Company’s other collaborative arrangements presented in the table above were included in deferred revenue at the beginning of the respective periods. 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) 2023 2022 Viatris $ 5,723 $ 6,682 Revenue from Licensing Arrangements Pfizer In December 2019, the Company entered into a global license agreement with Pfizer Inc. (“Pfizer”) for its preclinical skin-selective, locally-acting pan-JAK inhibitor program (the “Pfizer Agreement”). The compounds in this program are designed to target validated pro-inflammatory pathways and are specifically designed to possess skin-selective activity with minimal systemic exposure. Under the Pfizer Agreement, Pfizer had an exclusive license to develop, manufacture and commercialize certain compounds for all uses other than gastrointestinal, ophthalmic, and respiratory applications. The Company received an upfront cash payment of $10.0 million in 2019, and for the year ended December 31, 2022, the Company recognized $2.5 million in licensing revenue related to a development milestone payment from Pfizer for the dosing of the first patient in the Phase 1 clinical trial. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2023 | |
Segment Information | |
Segment Information | 3. Segment Information The Company operates in a single segment, which is the development and commercialization of human therapeutics. The following table summarizes total revenue by geographic region based on the location of the Company’s customers or collaboration partners: Year Ended December 31, (In thousands) 2023 2022 US $ 57,201 $ 51,124 Europe 223 222 Total revenue $ 57,424 $ 51,346 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) 2023 2022 Viatris 100 % 95 % Viatris accounted for 100% of the Company’s receivable from collaborative arrangements as of December 31, 2023 and 2022. |
Sale of Velusetrag
Sale of Velusetrag | 12 Months Ended |
Dec. 31, 2023 | |
Sale of Velusetrag. | |
Sale of Velusetrag | 4. Sale of Velusetrag Velusetrag is an oral, investigational medicine developed for gastrointestinal motility disorders. It is a highly selective agonist with high intrinsic activity at the human 5-HT4 receptor. In 2012, the Company partnered with Alfasigma S.p.A. (“Alfasigma”) in the development of velusetrag and its commercialization in certain countries. In April 2018, Alfasigma exercised its option to continue to develop and commercialize velusetrag, and the Company elected not to pursue further development. Global rights to develop, manufacture and commercialize velusetrag were transferred to Alfasigma under the terms of the collaboration arrangement. On June 30, 2022, the Company entered into an Asset Purchase Agreement (the “APA”) to sell all of its velusetrag assets to Alfasigma. In connection with the closing of the transaction, Alfasigma acquired, among other things, (i) intellectual property and (ii) books and records related to velusetrag. As consideration for the velusetrag sale, the Company received an upfront payment of $2.8 million in July 2022, and pursuant to the terms of the APA, the Company is eligible to receive up to $105.0 million in additional future developmental and sales milestones. At the time of the sale, the velusetrag assets had no remaining book value on the Company’s records, and all of the velusetrag assets were delivered to Alfasigma. For year ended December 31, 2022, the Company recognized a net gain of $2.7 million, after transaction costs, related to the sale of velusetrag within “ interest income and other income, net |
Cash, Cash Equivalents, and Res
Cash, Cash Equivalents, and Restricted Cash | 12 Months Ended |
Dec. 31, 2023 | |
Cash, Cash Equivalents, and Restricted Cash | |
Cash, Cash Equivalents, and Restricted Cash | 5. 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) 2023 2022 Cash and cash equivalents $ 39,545 $ 298,172 Restricted cash 836 836 Total cash, cash equivalents, and restricted cash shown on the consolidated statements of cash flows $ 40,381 $ 299,008 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 cash-related amounts reported in the table above exclude the Company’s investments in short and long-term marketable securities that are reported separately on the consolidated balance sheets. The Company periodically engages in foreign exchange transactions as a part of its operations. The Company recognized net realized and unrealized foreign currency gains of $0.06 million for the year ended December 31, 2023 and net realized and unrealized foreign currency losses of $0.9 million for the year ended December 31, 2022. These amounts are included in the Company’s consolidated statements of operations within “Interest income and other income, net”. |
Investments and Fair Value Meas
Investments and Fair Value Measurements | 12 Months Ended |
Dec. 31, 2023 | |
Investments and Fair Value Measurements | |
Investments and Fair Value Measurements | 6. 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, 2023 Gross Gross Amortized Unrealized Unrealized Estimated (In thousands) Cost Gains Losses Fair Value US government securities Level 1 $ 29,848 $ — $ (29) $ 29,819 US government agency securities Level 2 4,428 — (8) 4,420 Corporate notes Level 2 28,670 4 (32) 28,642 Marketable securities 62,946 4 (69) 62,881 Money market funds Level 1 26,179 — — 26,179 Total $ 89,125 $ 4 $ (69) $ 89,060 December 31, 2022 Gross Gross Amortized Unrealized Unrealized Estimated (In thousands) Cost Gains Losses Fair Value US government securities Level 1 $ 24,873 $ 8 $ — $ 24,881 US government agency securities Level 2 20,869 4 — 20,873 Commercial paper Level 2 37,307 — (27) 37,280 Marketable securities 83,049 12 (27) 83,034 Money market funds Level 1 220,508 — — 220,508 Total $ 303,557 $ 12 $ (27) $ 303,542 As of December 31, 2023, all of the Company’s available-for-sale securities had contractual maturities within transfers Available-for-sale debt securities with unrealized losses are summarized below: December 31, 2023 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 $ 29,819 $ (29) $ — $ — $ 29,819 $ (29) US government agency securities 4,420 (8) — — 4,420 (8) Corporate notes 23,641 (32) — — 23,641 (32) Total $ 57,880 $ (69) $ — $ — $ 57,880 $ (69) December 31, 2022 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 Commercial paper $ 37,280 $ (27) $ — $ — $ 37,280 $ (27) Total $ 37,280 $ (27) $ — $ — $ 37,280 $ (27) The Company invests primarily in high credit quality and short-term maturity T For the year ended December 31, 2023, the Company sold marketable securities for total proceeds of $71.4 million. The sales were based on the specific identification method, and the realized net gain from the sale was immaterial. For the year ended December 31, 2022, the Company did no t sell any marketable securities. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2023 | |
Property and Equipment. | |
Property and Equipment | 7. Property and equipment are held predominantly in the US and consisted of the following: December 31, (In thousands) 2023 2022 Computer equipment $ 1,883 $ 1,921 Software 762 1,088 Furniture and fixtures 1,738 1,674 Laboratory equipment 60 15,445 Leasehold improvements 26,207 24,583 Subtotal 30,650 44,711 Less: accumulated depreciation (21,582) (32,836) Property and equipment, net $ 9,068 $ 11,875 For the year ended December 31, 2023 and 2022, depreciation expense for property and equipment was $1.9 million and $2.6 million, respectively. As a result of strategic actions announced in February 2023 (see “ Note 16. 2021 Restructuring and 2023 Strategic Actions |
Leases
Leases | 12 Months Ended |
Dec. 31, 2023 | |
Leases | |
Leases | 8. Leases South San Francisco Lease and Subleases As of December 31, 2023, 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 2024 and had a remaining balance of $6.8 million and $8.9 million, as of December 31, 2023 and 2022, respectively. In June 2022, the Company entered into a non-cancelable agreement under which it subleased approximately 78,000 square feet of its South San Francisco office and laboratory space to an unaffiliated company. The sublease term continues through May 2030, consistent with the remaining lease term of the SSF Lease, and the subtenant has no In July 2021, the Company entered into a non-cancelable agreement under which it subleased approximately 21,000 square feet of its South San Francisco office and laboratory space to another unaffiliated company. Under the terms of the sublease agreement, the sublease term continues through September 2028, and the parties have no The Company recognizes the sublease income on a straight-line basis over the term of its two subleases which is reflected as a reduction of R&D expense and selling, general and administrative expenses in the consolidated statements of operations. No lease modification was deemed to have occurred by entering into the sublease agreements because the Company was not released, either fully or in part, from its obligations under the SSF Lease. “ Note 16. 2021 Corporate Restructuring Completion and 2023 Strategic Actions” Dublin Lease In April 2017, the Company leased approximately 6,100 square feet of office space in Dublin, Ireland, under a non-cancelable operating lease that expires in April 2027 (“Dublin Lease”). In May 2022, the Company entered into an agreement under which it assigned the Dublin Lease (“Lease Assignment”) to an unaffiliated company. The Company determined that the Lease Assignment would be accounted for as a lease modification under ASC 842, Leases Following the execution of the Lease Assignment, in May 2022, the Company entered into a new operating lease agreement for approximately The Company has evaluated its existing 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, 2023 December 31, 2022 Assets Operating lease assets Operating lease assets $ 36,287 $ 40,126 Liabilities Current: Operating lease liabilities Operating lease liabilities $ 3,923 $ 6,753 Non-current: Operating lease liabilities Long-term operating lease liabilities 45,236 45,407 Total operating lease liabilities $ 49,159 $ 52,160 In 2023, the Company recognized an increase to other assets and other current liabilities of $6.5 million for lessor tenant improvement allowances that have been assigned to its sublessees. The assigned tenant improvement allowance recorded as other assets is amortized over the lease term, and the assigned tenant improvement allowance recorded as a current liability will expire in November 2024. Lease expense and sublease income were included within operating expenses in the consolidated statements of operations as follows: Year Ended Year Ended (In thousands) Classification December 31, 2023 December 31, 2022 Operating lease expense (1) Selling, general and administrative expense $ 8,548 $ 8,314 Year Ended Year Ended (In thousands) Classification December 31, 2023 December 31, 2022 Operating sublease income Selling, general and administrative expense $ 8,361 $ 5,420 (1) Represents operating lease expense before sublease income. Excludes short-term leases which were not material and office lease service-related charges. Year Ended Year Ended (In thousands, except weighted average amounts) December 31, 2023 December 31, 2022 Operating cash flows from operating leases $ 9,966 $ 9,312 Weighted average remaining lease term 6.4 years 7.4 years Weighted average discount rate 8.64 % 8.63 % The Company determined that an implicit interest rate of its leases were not determinable and, therefore, used an incremental borrowing rate to determine the present value of its lease liabilities. The Company’s incremental borrowing 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. As of December 31, 2023, the maturities of the Company’s lease liabilities were as follows: (In thousands) Year ending December 31: 2024 $ 3,897 2025 10,940 2026 11,198 2027 11,479 2028 11,739 Thereafter 16,837 Total operating lease payments $ 66,090 Less: Estimated tenant improvement allowance (6,838) Less: Imputed interest (10,093) Present value of operating lease liabilities $ 49,159 As of December 31, 2023, the undiscounted cash flows to be received related to the Company’s subleases were as follows: (In thousands) Year ending December 31: 2024 $ 7,944 2025 8,181 2026 8,425 2027 8,675 2028 8,412 Thereafter 10,089 Total operating sublease receipts $ 51,726 |
Sale of Equity Interests in The
Sale of Equity Interests in Theravance Respiratory Cmpany, LLS and Discontinued Operations | 12 Months Ended |
Dec. 31, 2023 | |
Sale of Equity Interests in Theravance Respiratory Company, LLC and Discontinued Operations | |
Sale of Equity Interests in Theravance Respiratory Company, LLC and Discontinued Operations | 9. Sale of Equity Interests in Theravance Respiratory Company, LLC and Discontinued Operations Background In May 2014, the Company entered into the TRC LLC Agreement with Innoviva, Inc. (“Innoviva”) that governed the operation of Theravance Respiratory Company, LLC (“TRC”). Under the TRC LLC Agreement, Innoviva was the manager of TRC, and the business and affairs of TRC were 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 complied with applicable law and partner agreements. The Company was responsible for its proportionate share of TRC’s administrative expenses incurred as communicated to the Company, by Innoviva. Through the Company’s 85% equity interest in TRC, the Company was 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 Sale of Equity Interests in TRC On July 20, 2022, the Company completed the sale of its 2,125 Class B Units and 6,375 Class C Units (collectively, the “Issuer II Units”) of TRC to, and entered into a sale of future royalties from sales of ampreloxetine (see “ Note 10. Ampreloxetine Funding” Trelegy ELLIPTA (“TRELEGY”) At the closing of the TRC Transaction (the “Closing”), the Company received approximately $1.1 billion in cash. From and after January 1, 2023, for any calendar year starting with the year ended December 31, 2023 and ending with the year December 31, 2026, upon certain milestone minimum royalty amounts for the Assigned Collaboration Products being met, Royalty Pharma is obligated to make certain cash payments to the Company (the “Milestone Payments”), which are not to exceed $250.0 million in aggregate. For the year ended December 31, 2023, the minimum royalty amount was not achieved, and the remaining aggregate Milestone Payments available to the Company is $200.0 million. Additionally, the Company will receive from Royalty Pharma 85% of the royalty payments on the Assigned Collaboration Products payable (a) for sales or other activities occurring on and after January 1, 2031 related to the Assigned Collaboration Products in the US, and (b) for sales or other activities occurring on and after July 1, 2029 related to the Assigned Collaboration Products outside of the US. The Purchase Agreement contained customary representations and warranties of the Company and Royalty Pharma, including with respect to organization, authorization, intellectual property matters and tax matters, and certain covenants with respect to confidentiality, taxes and actions and conduct relating to preservation of TRC prior to the Closing. The Company and Royalty Pharma will each indemnify the other against damages arising from breaches of representations, warranties, and covenants under the Purchase Agreement. Effective as of the Closing, the Company consented to certain amendments to the Collaboration Agreement and the Extension Agreement, dated as of March 3, 2014, by and between the Company and GSK, as well as the termination of the Master Agreement, dated as of March 3, 2014, by and between Innoviva, the Company and GSK, and further released Innoviva, Innoviva TRC Holdings LLC, a Delaware limited liability company, Royalty Pharma and TRC for claims relating to TRC or the ownership of TRC by the Company or Innoviva prior to the Closing. The Company evaluated the TRC Transaction under ASC 860, Transfers and Servicing of Financial Assets, The Contingent Consideration was initially measured at fair value utilizing a Monte Carlo simulation model to calculate the present value of the risk-adjusted cash flows estimated to be received from the Contingent Consideration. The discount rate utilized in the valuation model was 7.83%. The fair value model involved significant unobservable inputs derived using management’s estimates. Management’s estimates were based in part on external data and reflected management’s judgements and forecasts. The primary significant unobservable input was the estimate of forecasted TRELEGY net revenues which is considered a Level 3 fair value input. The Company reassesses the carrying value of the Contingent Consideration when indicators of impairment are identified and will recognize any increases in the carrying value of the asset when such contingent gains are realized. As of December 31, 2023, there have been no changes to the carrying value of the Contingent Consideration since its initial measurement date in July 2022. The Contingent Consideration is subject to counterparty credit risk, and the carrying value of the Contingent Consideration represents the maximum amount of potential loss due to credit risk. To date, the Company has not recorded any credit losses related to the Contingent Consideration. The Contingent Consideration is presented on the consolidated balance sheets as Discontinued Operations The TRC Transaction represented a monetization of a significant equity method investment that had a major effect on the Company’s financial results. In accordance with GAAP, the TRC Transaction was accounted for as a sale of a financial asset. For all periods presented, balances and the results related to TRC have been classified as discontinued operations on the Company’s consolidated financial statements. Year Ended December 31, (In thousands) 2022 Income from investments in TRC, LLC $ 53,237 Transaction-related legal expenses (prior to July 20, 2022) (5,057) Interest expense on 9.5% Non-recourse notes due 2035 (21,312) Loss on extinguishment of debt (24,022) Net gain from sale of equity interests in TRC, LLC 1,141,084 Provision for income tax expense (178,974) Net income from discontinued operations $ 964,956 TRC Financial Information Prior to the TRC Transaction, the Company analyzed its ownership, contractual and other interests in TRC to determine if it was a variable-interest entity (“VIE”), whether the Company had a variable interest in TRC and the nature and extent of that interest. The Company determined that TRC was 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 was 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 was not the primary beneficiary of TRC, and, as a result, the Company did not consolidate TRC in its consolidated financial statements. The Company’s maximum exposure to loss, as a result of its involvement with TRC, were the amounts recorded in the consolidated balance sheets within “Amounts due from TRC, LLC” and “Equity in net assets of TRC, LLC”. For the year ended December 31, 2022, the Company recognized income from its investment in TRC of $53.2 million. As noted above, TRC is being recognized as discontinued operations as a result of the TRC Transaction. TRC’s balance sheet as of July 20, 2022 and TRC’s statement of income for the period from January 1, 2022 to July 20, 2022, including the portion of equity interest that the Company did not own, were as follows: (In thousands) July 20, 2022 Assets Cash and cash equivalents $ 29,309 Related party receivables from collaborative arrangements 42,720 Total assets $ 72,029 Liabilities and LLC Members' Equity Accrued liabilities — LLC members' equity 72,029 Total liabilities and LLC members' equity $ 72,029 Period Ended (In thousands) July 20, 2022 Royalty revenue and gross profit $ 72,029 General and administrative expenses (332) Other income, net 10 Realized loss on equity and long-term investments (39,385) Changes in fair value of equity and long-term investments, net (8,884) Net Income $ 23,438 |
Ampreloxetine Funding
Ampreloxetine Funding | 12 Months Ended |
Dec. 31, 2023 | |
Ampreloxetine Funding. | |
Ampreloxetine Funding | 10. Ampreloxetine Funding “Note 9. Sale of Equity Interests in Theravance Respiratory Company, LLC and Discontinued Operations” five ampreloxetine product or the manufacture or use thereof in the applicable country and (b) the expiration of regulatory exclusivity granted by the FDA or equivalent organization in the applicable country. As the Ampreloxetine Funding and the TRC Transaction were part of the same Purchase Agreement, the Company evaluated the total consideration received from Royalty Pharma and determined that the consideration received for each of the individual transactions approximated their relative fair values. The Company accounted for the Ampreloxetine Funding received from Royalty Pharma as a contingent liability because the Company has significant continuing involvement in generating the future revenue stream from which the contingent liability would be repaid to Royalty Pharma. If the regulatory approval milestone is achieved, the Company will recognize the $15.0 million milestone payment as an increase to the accumulated liability. If and when ampreloxetine obtains regulatory approval and is commercially launched, the Company will recognize the royalties paid to Royalty Pharma as a decrease to the accumulated liability due to Royalty Pharma and a corresponding reduction in cash. If ampreloxetine regulatory approval is not achieved or if ampreloxetine sales are never recognized, the contingent liability recognized would be extinguished as the Company would not be obligated to repay any of the funding amounts received from Royalty Pharma. The carrying amount of the contingent liability for the future royalty payment was based on the upfront $25.0 million received and management’s estimate of (i) the risk-adjusted future contingent $15.0 million milestone; and (ii) the amount and timing of royalties to be paid to Royalty Pharma and then discounted over the life of the arrangement using an imputed rate of interest. The excess of future estimated royalty payments over the amount of cash funding received will be recognized as interest expense using the effective interest method. The balance associated with the contingent liability was initially recorded as $25.0 million, net of allocated transaction costs, in July 2022 and was reported on the consolidated balance sheets as future royalty payment contingency. The Company periodically reassesses the amount and timing of estimated royalty payments. To the extent such payments are materially greater or less than the Company’s previous estimates, the Company will prospectively adjust the amortization of the contingent liability and the effective interest rate. The imputed effective rate of interest on the unamortized portion of the contingent liability was approximately 8.8% as of December 31, 2023. There are a number of factors that could materially affect the amount and timing of the contingent $15.0 million milestone and royalty payments, some of which Changes to the contingent liability for sale of future royalties were as follows for the year ended December 31, 2023: (In thousands) Balance at December 31, 2022 $ 25,438 Non-cash interest expense accretion 2,350 Balance at December 31, 2023 $ 27,788 |
Extinguishment of Debt
Extinguishment of Debt | 12 Months Ended |
Dec. 31, 2023 | |
Extinguishment of Debt | |
Extinguishment of Debt | 11. Extinguishment of Debt 9.5% Non-Recourse Notes Due 2035 In February 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”), 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”). The Non-Recourse 2035 Notes were secured by all of Issuer II’s right, title and interest as a holder of certain membership interests in TRC. TRC held the right to receive upward-tiering royalties ranging from 6.5% to 10% on worldwide net sales of TRELEGY, and, prior to the closing of the TRC Transaction (see “Note 9. Sale of Equity Interests in Theravance Respiratory Company, LLC and Discontinued Operations” In connection with the TRC Transaction, the Company redeemed the outstanding Non-Recourse 2035 Notes on July 20, 2022 and paid certain other fees and expenses in conjunction with that redemption. The total repayment was comprised of $400.0 million of net principal, $4.7 million of accrued interest, an early redemption premium fee of $20.0 million, and $0.2 million of transaction costs. The $400.0 million of net principal included $30.7 million of issuance-to-date net interest shortfall. The repayments resulted in a net loss on extinguishment of debt of $24.0 million, which was included within discontinued operations in the accompanying consolidated statements of operations for the year ended December 31, 2022. The loss on extinguishment of debt was calculated as the difference between the carrying amount of the Non-Recourse 2035 Notes and the amounts paid to redeem 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 were being amortized to interest expense over the estimated life of the Convertible Senior 2023 Notes. The Convertible Senior 2023 Notes bore an annual interest rate of 3.25%, payable semi-annually in arrears, on November 1 and May 1 of each year. On July 26, 2022, subsequent to the closing of the TRC Transaction, the Company launched a tender offer to retire the (the “2023 Notes Tender Offer”). Pursuant to the terms of the 2023 Notes Tender Offer, the Company paid all accrued and unpaid interest on the purchased Convertible Senior 2023 Notes from and including the last interest payment date of May 1, 2022 up to, but not including, the settlement date for the 2023 Notes Tender Offer. The 2023 Notes Tender Offer expired on August 23, 2022 (the “Expiration Time”). As of the Expiration Time, $230.0 million in aggregate principal amount of the Convertible Senior 2023 Notes, representing 100% of the outstanding Convertible Senior 2023 Notes, were validly tendered and not validly withdrawn pursuant to the 2023 Notes Tender Offer. The Company accepted for purchase all of the Convertible Senior 2023 Notes and settled the 2023 Notes Tender Offer on August 25, 2022. Total payments made by the Company under the 2023 Notes Tender Offer included $230.0 million of principal, $2.4 million of accrued interest, and $1.6 million of transaction costs. The repayments resulted in a net loss on extinguishment of debt of $3.0 million, which is included within “loss on extinguishment of debt” in the accompanying consolidated statements of operations for the year ended December 31, 2022. The loss on extinguishment of debt was calculated as the difference between the carrying amount of the Convertible Senior 2023 Notes and the amounts paid to settle the Convertible Senior 2023 Notes. As December 31, 2023, the Company did no t have any long-term debt. |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Compensation | |
Share-Based Compensation | 12. Share-Based Compensation Theravance Biopharma Equity Plans The Company has three equity compensation plans — the 2013 Equity Incentive Plan (the “2013 EIP”), the 2013 Employee Share Purchase Plan (the “2013 ESPP”) and the 2014 New Employee Equity Incentive Plan (the “2014 NEEIP”). The 2013 EIP provides for the issuance of share-based awards, including restricted shares, restricted share units (“RSUs), options, share appreciation rights (“SARs”) and other equity-based awards, to Company employees, officers, directors, and consultants. 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 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. At the Company’s Annual General Meeting of Shareholders on May 2, 2023, the Company’s shareholders approved an amendment and restatement of the 2013 EIP to effect the following material changes to the existing plan: (i) extend the term of the 2013 EIP by an additional ten years; (ii) eliminate the provision that provided for automatic annual increases in the number of shares available for issuance under the 2013 EIP; (iii) reduce the number of shares reserved for issuance by 3,808,287 shares; (iv) eliminate the Company’s ability to reprice options and share appreciation rights without first obtaining shareholder approval; and (v) remove certain provisions no longer necessary since the repeal of the exemption from the annual deduction limitation imposed by Section 162(m) of the Internal Revenue Code for performance-based compensation. 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, up to applicable regulatory limits. 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, RSUs, 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. As of December 31, 2023, the total number of shares available for future issuance under each of the plans were: 2013 EIP 5,339,942 2013 ESPP 2,453,502 2014 NEEIP 346,281 Total 8,139,725 Market and Performance-Contingent Awards The Company periodically grants market-based share awards to employees. For the year ended December 31, 2023, the Company granted 165,000 market-based restricted share units (“RSUs”). The 165,000 RSUs had a fair value of $1.4 million on the grant date that vest upon the Company’s ordinary shares meeting certain market-based price targets followed by a service period. The fair value of these market-based RSUs is being recognized through February 2027. For the year ended December 31, 2023, the Company recognized $0.7 million of share-based compensation expense related to the awards. There were no market-based RSUs granted or expensed for the year ended December 31, 2022. Separate from the market-based RSUs described above, the Company granted 367,000 and 43,000 of performance-contingent RSUs for the year ended December 31, 2023 and 2022, respectively. The 367,000 and 43,000 RSUs had a fair value of $3.7 million and $0.4 million, respectively, on grant date with performance vesting dates through February 2026. As of December 31, 2023, the Company concluded that 59,000 of the RSUs were probable of achievement, and as a result, the Company recognized $0.4 million of cumulative catch-up share-based compensation expense for the year ended December 31, 2023. Share-Based Compensation Modifications As a result of the Company’s corporate restructuring announcement in September 2021, the Board of Directors’ Compensation Committee approved the acceleration of certain equity awards for employees affected by the restructuring. The Company accounted for this acceleration as a Type III modification (improbable to probable). In 2022, the Company completed the 2021 restructuring that resulted in an equity award Type III modification fair value of $2.5 million which was recorded in “Restructuring and related expenses” within the consolidated statements of operations for the year ended December 31, 2022. The total cumulative compensation cost previously recognized for these modified awards of $0.8 million was reversed in the year ended December 31, 2022 within “Research and development” and “Selling, general and administrative” expenses. The acceleration resulted in a net incremental share-based compensation expense of $1.7 million for the year ended December 31, 2022 and impacted approximately 40 terminated employees that met the conditions of the acceleration. 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) 2023 2022 Research and development $ 8,048 $ 12,888 Selling, general and administrative 16,966 19,848 Restructuring and related expenses 357 6,998 Total share-based compensation expense $ 25,371 $ 39,734 Share-based compensation expense included in the consolidated statements of operations by award type was as follows: Year Ended December 31, (In thousands) 2023 2022 Options $ 2,294 $ 2,998 RSUs 21,817 35,726 Performance RSUs 1,087 237 ESPP 173 773 Total share-based compensation expense $ 25,371 $ 39,734 As of December 31, 2023, 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) Options $ 2,600 1.88 RSUs 30,404 2.36 Performance RSUs (1) 849 1.26 ESPP 504 1.05 Total $ 34,357 (1) Represents unrecognized share-based compensation cost associated with the Company’s market-based and 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, 2023: Weighted-Average 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, 2022 2,411,893 $ 19.53 Granted 262,386 10.84 Exercised — - Forfeited (368,403) 18.85 Outstanding at December 31, 2023 2,305,876 5.32 18.65 $ 859 Exercisable at December 31, 2023 4.48 487 Vested and expected to vest at December 31, 2023 5.32 859 The following table summarizes additional information for options under the 2013 EIP and 2014 NEEIP. 2023 2022 Weighted average fair value of options (in dollars) $ 5.74 $ 5.33 Total intrinsic value of options exercised (in thousands) $ — $ — The following table summarizes total RSU activity (including market-based and performance-contingent RSUs) for the year ended December 31, 2023: Number of Shares Number of Shares Subject to Outstanding Subject to Outstanding RSUs Performance Conditions (RSAs) Outstanding at December 31, 2022 4,109,847 — Granted 2,228,184 — Released (1,651,141) — Forfeited (691,140) — Outstanding at December 31, 2023 3,995,750 — The total estimated fair value of RSUs vested was $17.3 million and $37.2 million in 2023 and 2022, 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, 2023 2022 Options Risk-free interest rate 3.46% - 4.18% 1.5% - 3.8% Expected term (in years) 5.3 - 6.5 5.3 - 6.1 Volatility 53% - 55% 55% - 70% Dividend yield — — Weighted-average estimated fair value $ 5.74 $ 5.33 2013 ESPP Risk-free interest rate 4.06% - 5.39% 1.5% - 4.57% Expected term (in years) 0.5 - 2.0 0.5 - 2.0 Volatility 32% - 58% 41% - 72% Dividend yield — — Weighted-average estimated fair value $ 3.46 $ 3.86 |
Defined Contribution Plan
Defined Contribution Plan | 12 Months Ended |
Dec. 31, 2023 | |
Defined Contribution Plan | |
Defined Contribution Plan | 13. Defined Contribution Plan |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2023 | |
Income Taxes | |
Income Taxes | 14. 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 income (loss) before income taxes of Theravance Biopharma, the parent company, were included in Ireland in the tables below. The components of the loss before income taxes from continuing operations were as follows: Year Ended December 31, (In thousands) 2023 2022 Income (loss) before provision for income taxes: United States $ 1,151 $ (40,556) Ireland (50,420) (52,168) United Kingdom — (91) Total $ (49,269) $ (92,815) The components of provision for income tax expense from continuing operations were as follows: Year Ended December 31, (In thousands) 2023 2022 Provision for income tax (expense) benefit: Current: United States $ (2,881) $ — Ireland — (8) United Kingdom 164 (1) Subtotal (2,717) (9) Deferred: United States (3,207) — Subtotal (3,207) — Total $ (5,924) $ (9) Effective tax rate 12.02 % (0.01) % The provision for income tax expense was $5.9 million and $9,000 for the year ended December 31, 2023 and 2022, respectively. The income tax expense for the year ended December 31, 2023 was primarily attributed to the Company’s profitability in the US jurisdiction which no longer had a valuation allowance offset for federal tax purposes due to the valuation allowance’s release in 2022. We expect to have an immaterial federal cash tax expense for the year ended December 31, 2023 which will be offset with a prior year overpayment. Income tax expense related to discontinued operations for the year ended December 31, 2022 of $179.0 million was a result of the Company’s gain from the TRC Transaction, which was recognized as a discontinued operation. No provision for income taxes has been recognized on undistributed earnings of the Company’s foreign subsidiaries because it considers such earnings to be indefinitely reinvested. In the event of a distribution of these earnings in the form of dividends or otherwise, the Company may be liable for income taxes, subject to an adjustment, if any, for foreign tax credits and foreign withholdings taxes payable to certain foreign tax authorities. As of December 31, 2023, there were no undistributed earnings. 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 for non-trading income Year Ended December 31, 2023 2022 Provision at statutory income tax rate 25.00 % 25.00 % Foreign rate differential (8.28) (6.80) Share-based compensation (3.00) (3.28) Non-deductible executive compensation (4.45) (2.79) Uncertain tax positions (7.31) (7.10) Research and development tax credit carryforwards 3.34 2.65 Change in valuation allowance (16.00) (1.01) Other (1.32) (6.68) Effective tax rate (12.02) % (0.01) % December 31, (In thousands) 2023 2022 Deferred tax assets: Net operating loss carryforwards $ 153,225 $ 141,674 Capital loss carryforwards 21,482 19,409 Research and development tax credit carryforwards 16,910 16,176 Fixed assets and intangibles 235,381 245,822 Share-based compensation 3,431 4,298 Accruals 1,186 1,795 Operating lease liabilities 10,946 11,239 Prepaid assets (248) 304 Other 4,982 30 Subtotal 447,295 440,747 Valuation allowance (429,850) (422,325) Total deferred tax assets 17,445 18,422 Deferred tax liabilities: Operating lease assets (8,076) (8,634) Future contingent milestone and royalty assets (14,512) (11,725) Total deferred tax liabilities (22,588) (20,359) Net deferred tax liabilities $ (5,143) $ (1,937) As of December 31, 2023, the Company has utilized all available US federal net operating loss carryforwards and federal research and development tax credit carryforwards. As of December 31, 2023, the Company had state net operating loss carryforwards of $103.8 million which generally begin to expire in 2034 and state research and development credit carryforwards of $25.9 million to be carried forward indefinitely. As of December 31, 2023, the Company had Irish net operating loss carryforwards of $1.16 billion with no expiration date and capital loss carryforwards of $65.1 million to be carried forward indefinitely. The Company has additional Irish tax attributes of $1.04 billion which primarily consist of unused capital allowances. Net operating losses and capital allowances can be used to offset future income from Irish entities and income related to intellectual property. Utilization of federal and state 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. 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, 2021 $ 75,023 Gross decrease in tax positions for prior years (7,395) Gross increase in tax positions for current year 8,371 Unrecognized tax benefits as of December 31, 2022 75,999 Gross decrease in tax positions for prior years (632) Gross increase in tax positions for current year 4,103 Unrecognized tax benefits as of December 31, 2023 $ 79,470 The total unrecognized tax benefits of $79.5 million and $76.0 million, as of December 31, 2023 and December 31, 2022, respectively, would reduce the effective tax rate in the period of recognition. As of December 31, 2023, the Company does not believe that it is reasonably possible that its unrecognized tax benefit will significantly increase or decrease in the next twelve months. The Company is not currently under Internal Revenue Service (“IRS”) examination. 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'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 $0.6 million for the year ended December 31, 2023 and was not material for the year ended December 31, 2022. The Company will continue to accrue interest on the respective uncertain tax positions in accordance with applicable rules. The Company’s $65.3 million net liability for unrecognized tax benefits relating to uncertain tax positions, as of December 31, 2023, can be relieved only if (i) the contingency becomes legally extinguished through either payment to the taxing authority or expiration of the statute of limitations; (ii) the recognition of the benefits associated with the position meets the more likely than not threshold; or (iii) the liability becomes effectively settled through the examination process. The Company considers matters to be effectively settled once the taxing authority has completed all of its required or expected examination procedures, including all appeals and administrative reviews. The Company also accrues for potential interest and penalties related to unrecognized tax benefits in its income tax expense (benefit) calculation. The Company is subject to taxation in Ireland, the US, and various other jurisdictions. The tax years 2015 and forward remain open to examination in Ireland, tax years 2015 and forward remain open to examination in the US, and the tax years 2012 and forward remain open to examination in other jurisdictions. The Company’s future income tax expense may be affected by such factors as changes in tax laws, regulations, its business, tax rates, interpretation of existing laws or regulations, the impact of accounting for share-based compensation, the impact of accounting for business combinations and other transactions, 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. |
Capital Return Program
Capital Return Program | 12 Months Ended |
Dec. 31, 2023 | |
Capital Return Program | |
Capital Return Program | 15. Capital Return Program In September 2022, the Company’s board of directors authorized a $250.0 million capital return program consisting of three elements as described below. GSK Share Repurchase On September 20, 2022, the Company repurchased 9,644,807 ordinary shares, par value $0.00001 per share, of the Company from GSK Finance (No.3) plc (“GSK Finance”), representing all of the ordinary shares of the Company owned by GSK Finance or its affiliates. The purchase price under the Share Repurchase Agreement was $9.75 per share, resulting in a total consideration of $94.0 million. The repurchased shares were accounted for as authorized shares that are no longer issued and outstanding upon the settlement date of the repurchase transaction. Modified Dutch Auction Tender Offer On September 28, 2022, the Company announced a “modified Dutch auction” tender offer (the “Offer”) to purchase up to $95.0 million of its ordinary shares. Upon the terms and subject to the conditions set forth in the Company's Offer to Purchase, dated September 28, 2022 (the "Offer to Purchase"), and the related Letter of Transmittal, the Company offered to purchase up to $95.0 million of its ordinary shares, at a purchase price not greater than $10.50 nor less than $9.75 per share, in cash, less any applicable withholding taxes and without interest. The Offer expired at midnight, New York City time, at the end of the day on November 17, 2022. A "modified Dutch auction" tender offer allows shareholders to indicate how many shares and at what price or within the range described above they wish to tender their shares. Based on the number of shares tendered and the prices specified by the tendering shareholders, the Company determined the lowest per-share price that enabled it to purchase up to $95.0 million of all shares that were validly tendered and not validly withdrawn. All shares accepted in the Offer were purchased at the same price even if tendered at a lower price. On November 22, 2022, the Company completed the Offer and purchased a total of 115,967 ordinary shares at a price of $10.50 per share, for an aggregate cost of $1.2 million, excluding fees and expenses relating to the Offer. The total of 115,967 shares that were accepted for purchase represented approximately 0.2% of the total number of shares outstanding as of November 21, 2022. The purchased shares were cancelled and ceased to be outstanding. The Company used the unused portion of the Offer to enlarge its previously announced, planned open market share repurchase plan which is described below. Open Market Share Repurchase Plan In December 2022, the Company initiated its open market repurchase plan to repurchase ordinary shares, and in February 2023, the Company’s board of directors authorized a $75.0 million increase to the $250.0 million capital return program bringing the total capital return program to $325.0 million. The table below summarizes the share repurchases under the Company’s open market repurchase plan for the following periods: Year Ended December 31, (In thousands, except per share amounts) 2023 2022 Shares repurchased 18,634 2,978 Amount repurchased (excluding fees and expenses) $ 196,608 $ 32,946 Weighted average cost per share (excluding fees and expenses) $ 10.551 $ 11.062 In January 2024, the Company repurchased an additional 38,462 shares on the open market at an weighted average cost of $11.551 per share for an approximate aggregate cost of $0.4 million, excluding fees and expenses, to compete its capital return program. Since the initiation of the capital return program in September 2022 through January 2024, the Company repurchased 31.41 million of shares at a weighted average price of $10.354 per share for an approximate aggregate cost of $325.3 million, excluding fees and expenses. |
2021 Corporate Restructuring Co
2021 Corporate Restructuring Completion and 2023 Strategic Actions | 12 Months Ended |
Dec. 31, 2023 | |
2021 Corporate Restructuring Completion and 2023 Strategic Actions | |
2021 Corporate Restructuring Completion and 2023 Strategic Actions | 16. 2021 Corporate Restructuring Completion and 2023 Strategic Actions 2021 Corporate Restructuring In September 2021, the Company announced a strategic update and corporate restructuring (the “2021 Restructuring”) to focus on leveraging its expertise in developing and commercializing respiratory therapeutics. As part of the 2021 Restructuring, the Company initiated an approximate 75% reduction in workforce. A majority of the reduction in workforce occurred in November 2021, For the year ended December 31, 2022, the Company incurred restructuring and related expenses of $12.8 million of which Since the 2021 Restructuring was announced and through its completion in September 2022, the Company incurred total restructuring and related expenses of $33.0 million of which selling 2023 Strategic Actions In February 2023, the Company announced new strategic actions (the “2023 Strategic Actions” As a result of the Company’s discontinued investment in research activities, the Company incurred restructuring and related expenses of $2.7 million for the year ended December 31, 2023, primarily the year ended December 31, 2023 Selected information relating to accrued cash-related restructuring expenses from the 2023 Strategic Actions was as follows: (In thousands) Balance at December 31, 2022 $ — Net accruals 1,188 Cash paid (1,188) Balance at December 31, 2023 $ — The Company also evaluated the impact of the 2023 Strategic Actions on the carrying value of its long-lived assets, such as property and equipment and operating lease assets, and in March 2023, the Company placed approximately 42,000 square feet of its vacant office and laboratory space in South San Francisco (“Sublease Assets”) on the market for sublease. The Company’s impairment evaluation process for the Sublease Assets consisted of comparing the estimated undiscounted future sublease income of the Sublease Assets to its carrying value. The Company estimated the sublease income using market participant assumptions, including the length of time to enter into a sublease and sublease payments, which the Company evaluated using recent sublease negotiations and current local subleasing trends. While the Company has not yet completed a new sublease, based on its evaluation, the Company determined that the estimated undiscounted future sublease income exceeds the Sublease Assets’ carrying value, and as a result, the Company did not recognize an impairment charge as of December 31, 2023. The Company will continue to update its sublease cash flow estimates based on changes in market conditions, and the Company may record a non-cash impairment charge in future periods as these estimates change. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies | |
Commitments and Contingencies | 17. Commitments and Contingencies Contract Obligations In the ordinary course of business, the Company may enter into agreements with service providers to assist in the performance of its clinical trials and other operational activities. Subject to required notice periods and other varying provisions regarding termination, the Company can elect to terminate such agreements at any time. Lease Commitments The Company leases certain office and laboratory space. See “Note 8. Leases,” Indemnifications The Company indemnifies its directors and officers for certain events or occurrences, subject to certain limits, that may arise by reason of their status or service as directors or officers to the extent permissible under applicable law. The Company maintains director and officer liability insurance policies that may limit its exposure. o assurances can be given regarding the amounts that may ultimately be covered by the insurers, and it is possible that the Company may incur substantial liabilities in the future resulting from these indemnification obligations. Legal Proceedings In the ordinary course of business, the Company may be subject to legal claims and regulatory actions that could have a material adverse effect on its business or financial position. The Company assesses it potential liability in such situations by analyzing the possible outcomes of various litigation, regulatory, and settlement strategies. If the Company determines that a material loss is probable and its amount can be reasonably estimated, it will accrue an amount equal to the estimated loss. As of December 31, 2023, the Company did not accrue any estimated losses related to its ongoing legal proceedings. Litigation – Patent Infringement During January 2023, the Company received notice from Accord Healthcare, Inc.; Cipla USA, Inc. and Cipla Limited; Eugia Pharma Specialties Ltd.; Lupin Inc.; Mankind Pharma Ltd.; Orbicular Pharmaceutical Technologies Private Limited; and Teva Pharmaceuticals, Inc. (collectively, the “generic companies”), that they have each filed with FDA an abbreviated new drug application (“ANDA”), for a generic version of YUPELRI. The notices from the generic companies each included a paragraph IV certification with respect to five of the Company’s patents listed in FDA’s Orange Book for YUPELRI on the date of the Company’s receipt of the notice. The asserted patents relate generally to polymorphic forms of and a method of treatment using YUPELRI. In February 2023, the Company filed patent infringement suits against the generic companies in federal district court, including the United States District Court for the District of New Jersey, the U.S. District Court for the District of Delaware, and the U.S. District Court for the Middle District of North Carolina. The suits in Delaware and North Carolina have been dismissed, as all generic companies have agreed to venue in New Jersey. The complaint alleges that by filing the ANDAs, the generic companies have infringed five of the Company’s Orange Book listed patents. The Company is seeking a permanent injunction to prevent the generic companies from introducing a generic version of YUPELRI that would infringe its patents. As a result of this lawsuit, a stay of approval through May 2026 has been imposed by the FDA on the generic companies’ ANDAs pending any adverse court decision. Additional patents covering YUPELRI granted on July 4, 2023 and January 2, 2024 were subsequently listed in FDA’s Orange Book. The Company filed additional patent infringement suits in the U.S. District Court for the District of New Jersey during August 2023 and January 2024. These suits have been consolidated with the above action. Further, the original complaint was amended during December 2023 to include certain patents not listed in the Orange Book. As of February 28, 2024, the Company has settled all litigation with Accord Healthcare, Inc.; Lupin Pharmaceuticals, Inc.; Orbicular Pharmaceutical Technologies Private Limited; and Teva Pharmaceuticals, Inc. pursuant to individual agreements in which the Company granted these companies a royalty-free, non-exclusive, non-sublicensable, non-transferable license to manufacture and market their respective generic versions of YUPELRI inhalation solution in the US on or after the licensed launch date of April 23, 2039, subject to certain exceptions as is customary in these type of agreements. As required by law, the settlements are subject to review by the U.S. Department of Justice and the Federal Trade Commission. The patent litigation against the three remaining generic companies, along with certain affiliates, remains pending. |
SUPPLEMENTARY FINANCIAL DATA (U
SUPPLEMENTARY FINANCIAL DATA (UNAUDITED) | 12 Months Ended |
Dec. 31, 2023 | |
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, 2023 and 2022. 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 all periods prior to the quarter ended September 30, 2022, the information below has been retroactively adjusted for discontinued operations presentation. For the Quarter Ended March 31, June 30, September 30, December 31, 2023 Total revenue $ 10,417 $ 13,749 $ 15,693 $ 17,565 Costs and expenses 35,329 29,872 24,453 23,805 Loss from operations (24,912) (16,123) (8,760) (6,240) Net loss from continuing operations (22,088) (15,645) (8,950) (8,510) Net income from discontinued operations — — — — Net income (loss) (22,088) (15,645) (8,950) (8,510) Net loss from continuing operations - basic and diluted per share (0.35) (0.28) (0.17) (0.17) Net income from discontinued operations - basis and diluted per share — — — - Net income (loss) - basis and diluted per share $ (0.35) $ (0.28) $ (0.17) $ (0.17) 2022 Total revenue $ 13,196 $ 11,050 $ 12,451 $ 14,649 Costs and expenses 51,698 37,929 21,595 32,081 Loss from operations (38,502) (26,879) (9,144) (17,432) Net loss from continuing operations (41,538) (26,570) (10,460) (14,256) Net income from discontinued operations 15,592 18,379 927,091 3,894 Net income (loss) (25,946) (8,191) 916,631 (10,362) Net loss from continuing operations - basic and diluted per share (0.55) (0.35) (0.21) (0.21) Net income from discontinued operations - basis and diluted per share 0.21 0.24 12.35 0.06 Net income (loss) - basis and diluted per share $ (0.34) (0.11) 12.14 (0.15) Share of Total YUPELRI Net Sales (1) For the Quarter Ended March 31, June 30, September 30, December 31, 2023 $ 16,434 $ 19,263 $ 20,414 $ 21,225 2022 $ 15,283 $ 17,177 $ 18,698 $ 19,495 (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, 2023 | |
Organization and Summary of Significant Accounting Policies | |
Basis of Presentation | Basis of Presentation The Company’s consolidated financial statements as of December 31, 2023 and 2022, and for the year ended December 31, 2023 and 2022 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. On July 20, 2022, the Company completed a monetization of its ownership interests in a significant equity method investment which had a major effect on the Company’s financial results for the year ended December 31, 2022 (see “ Note 9. Sale of Equity Interests in Theravance Respiratory Company, LLC and Discontinued Operations” Certain prior period amounts in the “Notes to Consolidated Financial Statements” have been reclassified. |
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. Due to the inherent uncertainty in making estimates, actual results in future periods could differ materially from those estimates. |
Segment Reporting | Segment Reporting The Company has determined that its chief executive officer is the chief operating decision maker (“CODM”). A single management team reports to the CODM who comprehensively manages the entire business. The Company’s business offerings have similar economics and other characteristics, including the nature of products, types of customers, distribution methods, and regulatory environment. As a result, the Company has concluded that it operates in a single segment which is the development and commercialization of human therapeutics. |
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 cost which approximates fair value due to their short-term nature. |
Restricted Cash | Restricted Cash “Note 5. 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, US government bonds and US government agency bonds. Marketable debt securities with original maturities of greater than three months and remaining maturities of less than 12 months are considered short-term investments. Marketable debt securities with maturities greater than 12 months are considered long-term investments. The Company determines the appropriate classification of the marketable securities at the time they are acquired and evaluates the appropriateness of such classifications at each balance sheet date. 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. Unrealized gains and losses are included as a component of accumulated other comprehensive income (loss) in shareholders’ equity of the consolidated balance sheets and as a component of total comprehensive income (loss) in the consolidated statements of operations and comprehensive income (loss) . The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity, which is included as a component of 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). 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. 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 |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company defines fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. ASC Topic 820, Fair Value Measurements and Disclosures Level 1 Level 2 Level 3 |
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 future contingent milestone and royalty assets and receivables primarily relate to amounts due under its collaboration and other 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, 2023 and 2022, the Company did not experience any 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 are depreciated using the straight-line method over the estimated useful lives as presented in the table below. Upon retirement or sale, the cost of the disposed assets and the related accumulated depreciation are removed from the consolidated balance sheet and any resulting gain or loss is reflected in the consolidated statement of operations in the period realized. 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 over 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 at the commencement date of the leasing arrangement, 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 estimated 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. When combining lease and non-lease components, the Company would account for the lease and non-lease components Operating lease assets and operating lease liabilities are remeasured upon reassessment events and modifications to leases using the present value of remaining lease payments and incremental borrowing rate at the time of remeasurement, as applicable. Operating lease assets are evaluated for possible impairment in accordance with the Company’s long-lived assets policy. The Company recognizes variable lease payments as operating expenses in the period in which the obligation for those payments is incurred. Variable lease payments primarily include common area maintenance, utilities, real estate taxes, insurance, and other operating costs that are passed on from the lessor in proportion to the space leased by the Company. The Company has elected to 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 . |
Future Contingent Milestone and Royalty Assets | Future Contingent Milestone and Royalty Assets The fair value of consideration received in connection with TRC Transaction in July 2022 (see “ Note 9. Sale of Equity Interests in Theravance Respiratory Company, LLC and Discontinued Operations” |
Future Royalty Payment Contingency | Future Royalty Payment Contingency Note 10. Ampreloxetine Funding” |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company regularly reviews long-lived assets, including operating lease assets, to determine whether indicators of impairment may exist. If indications of impairment exist, the Company performs a test of recoverability by comparing the estimated undiscounted future cash flows expected to result from the use of the asset over its useful life to the carrying value of the long-lived asset. If the carrying value of the long-lived asset exceeds such estimated undiscounted cash flows, the Company would determine the estimated fair value of the long-lived assets generally using the estimated discounted future cash flows to recognize an impairment loss on the long-lived asset. The Company did not recognize any impairment losses related to its long-lived assets for either the year ended December 31, 2023 or 2022. |
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 facility costs, and fees paid to third parties that conduct certain clinical study 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 may accrue include: • fees paid to investigative sites in connection with clinical studies; • fees paid to contract manufacturing organizations (“CMOs”) in connection with the production of 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 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. |
Selling, General and Administrative Expenses | Selling, General and Administrative Expenses Selling, general and administrative (“SG&A”) expenses are recorded in the period that services are rendered or goods are received. SG&A expenses consist primarily of salaries and benefits, facilities and overhead costs, and other costs related to areas such as legal, finance, information technology, sales and marketing, and medical affairs. Advertising expenses within selling, general and administrative expenses, including promotional expenses, were $5.1 million and $8.0 million for the year ended December 31, 2023 and 2022, respectively. |
Share-Based Compensation | Share-Based Compensation 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 to be 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 share 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: (i) the expected term of the options and ESPP purchases; (ii) the share’s expected dividend yield; (iii) the expected share price volatility; and (iv) the risk-free interest rate. The expected share price volatility is based on the historical volatility, and the risk-free interest rate is based on the US Treasury rate commensurate with the expected term of the associated award. The Company previously used the “simplified” method as described in Staff Accounting Bulletin No. 107, Share-Based Payment exercise data and transitioned to estimating the expected option term based on its historical option exercise behavior. The change in expected term methodology did not have a material impact to the financial statements. The Company may also issue performance-contingent RSUs that settle in the Company’s ordinary shares. The fair value of the performance-contingent RSUs is determined on the day of grant using the number of shares expected to be The Company may also issue market-based RSUs that settle in the Company’s ordinary shares. Market-based RSUs vest upon the Company’s shares meeting certain market-based price targets followed by a service period. The fair value of the market-based RSUs is determined using a Monte-Carlo valuation model. Share-based compensation expense is recognized over the requisite service period regardless of whether or not the market-based price targets are deemed probable, and the share-based compensation expense is not reversed solely because the market-based price target is not achieved. |
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 gross unrecognized tax benefits associated with uncertain tax positions 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 Income (Loss) per Share and Anti-dilutive Securities | Net Income (Loss) per Share and Anti-dilutive Securities Basic net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of shares outstanding during the period. Diluted net income (loss) per share is computed by increasing the weighted- average number of shares outstanding for the dilutive effect of potential ordinary shares determined using the treasury stock method. Potential ordinary shares include outstanding share options, ordinary shares expected to be issued under the Company’s ESPP, RSUs, and performance-contingent RSUs for which the performance or market vesting conditions have been deemed probable. Performance-contingent RSUs with performance or marketing vesting conditions that have been deemed not probable as of the end of the period are not included in the diluted net income (loss) per share computation. Year Ended December 31, (In thousands, except per share data) 2023 2022 Numerator: Net loss from continuing operations $ (55,193) $ (92,824) Net income from discontinued operations — 964,956 Net income (loss) (55,193) 872,132 Denominator: Weighted-average ordinary shares outstanding 55,303 73,591 Less: weighted-average ordinary shares subject to forfeiture — — Weighted-average ordinary shares outstanding - basic and diluted 55,303 73,591 Net income (loss) per share: Continuing operations - basic and diluted $ (1.00) $ (1.26) Discontinued operations - basic and diluted $ — $ 13.11 Net income (loss) per share - basic and diluted $ (1.00) $ 11.85 In accordance with ASC 260, Earnings Per Share Year Ended December 31, (In thousands) 2023 2022 Options 2,348 2,601 Restricted shares 1,523 2,851 Employee share purchase plan 45 35 Total 3,916 5,487 |
Comprehensive Income (Loss) | Comprehensive Income (Loss) Comprehensive income (loss) is comprised of net income (loss) and changes in unrealized gains and losses on the Company’s available-for-sale investments. |
Recently Issued Accounting Pronouncements Not Yet Adopted | Recently Issued Accounting Pronouncements Not Yet Adopted In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures The Company is evaluating the impact of adopting ASU 2023-09 on its consolidated financial statements income tax 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, 2023 | |
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 income (loss) per share | Year Ended December 31, (In thousands, except per share data) 2023 2022 Numerator: Net loss from continuing operations $ (55,193) $ (92,824) Net income from discontinued operations — 964,956 Net income (loss) (55,193) 872,132 Denominator: Weighted-average ordinary shares outstanding 55,303 73,591 Less: weighted-average ordinary shares subject to forfeiture — — Weighted-average ordinary shares outstanding - basic and diluted 55,303 73,591 Net income (loss) per share: Continuing operations - basic and diluted $ (1.00) $ (1.26) Discontinued operations - basic and diluted $ — $ 13.11 Net income (loss) per share - basic and diluted $ (1.00) $ 11.85 |
Schedule of anti-dilutive securities | Year Ended December 31, (In thousands) 2023 2022 Options 2,348 2,601 Restricted shares 1,523 2,851 Employee share purchase plan 45 35 Total 3,916 5,487 |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Revenue | |
Schedule of revenue recognized from collaborative arrangements | Year Ended December 31, (In thousands) 2023 2022 Viatris collaboration agreement – Amounts receivable from Viatris $ 57,201 $ 48,624 Viatris royalties (Non-US) 7 30 Total $ 57,208 $ 48,654 Year Ended December 31, (In thousands) 2023 2022 YUPELRI net sales (Theravance Biopharma implied 35%) $ 77,337 $ 70,653 |
Schedule of collaborative amounts were recorded in the Company's condensed consolidated statements of operations | Year Ended December 31, (In thousands) 2023 2022 Viatris $ 216 $ 24 Other — 168 Total collaboration revenue $ 216 $ 192 |
Summary of the reductions to R&D costs related to reimbursement payments | Year Ended December 31, (In thousands) 2023 2022 Viatris $ 5,723 $ 6,682 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Segment Information | |
Schedule of total revenue by geographic region | Year Ended December 31, (In thousands) 2023 2022 US $ 57,201 $ 51,124 Europe 223 222 Total revenue $ 57,424 $ 51,346 |
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) 2023 2022 Viatris 100 % 95 % |
Cash, Cash Equivalents, and R_2
Cash, Cash Equivalents, and Restricted Cash (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Cash, Cash Equivalents, and Restricted Cash | |
Schedule of reconciliation of cash, cash equivalents, and restricted cash | December 31, (In thousands) 2023 2022 Cash and cash equivalents $ 39,545 $ 298,172 Restricted cash 836 836 Total cash, cash equivalents, and restricted cash shown on the consolidated statements of cash flows $ 40,381 $ 299,008 |
Investments and Fair Value Me_2
Investments and Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Investments and Fair Value Measurements | |
Schedule of available-for-sale securities | December 31, 2023 Gross Gross Amortized Unrealized Unrealized Estimated (In thousands) Cost Gains Losses Fair Value US government securities Level 1 $ 29,848 $ — $ (29) $ 29,819 US government agency securities Level 2 4,428 — (8) 4,420 Corporate notes Level 2 28,670 4 (32) 28,642 Marketable securities 62,946 4 (69) 62,881 Money market funds Level 1 26,179 — — 26,179 Total $ 89,125 $ 4 $ (69) $ 89,060 December 31, 2022 Gross Gross Amortized Unrealized Unrealized Estimated (In thousands) Cost Gains Losses Fair Value US government securities Level 1 $ 24,873 $ 8 $ — $ 24,881 US government agency securities Level 2 20,869 4 — 20,873 Commercial paper Level 2 37,307 — (27) 37,280 Marketable securities 83,049 12 (27) 83,034 Money market funds Level 1 220,508 — — 220,508 Total $ 303,557 $ 12 $ (27) $ 303,542 |
Schedule of Available for sale debt securities with unrealized losses | December 31, 2023 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 $ 29,819 $ (29) $ — $ — $ 29,819 $ (29) US government agency securities 4,420 (8) — — 4,420 (8) Corporate notes 23,641 (32) — — 23,641 (32) Total $ 57,880 $ (69) $ — $ — $ 57,880 $ (69) December 31, 2022 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 Commercial paper $ 37,280 $ (27) $ — $ — $ 37,280 $ (27) Total $ 37,280 $ (27) $ — $ — $ 37,280 $ (27) |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Property and Equipment. | |
Schedule of property and equipment | December 31, (In thousands) 2023 2022 Computer equipment $ 1,883 $ 1,921 Software 762 1,088 Furniture and fixtures 1,738 1,674 Laboratory equipment 60 15,445 Leasehold improvements 26,207 24,583 Subtotal 30,650 44,711 Less: accumulated depreciation (21,582) (32,836) Property and equipment, net $ 9,068 $ 11,875 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Lessor, Lease, Description [Line Items] | |
Summary of supplemental balance sheet information related to leases | (In thousands) Classification December 31, 2023 December 31, 2022 Assets Operating lease assets Operating lease assets $ 36,287 $ 40,126 Liabilities Current: Operating lease liabilities Operating lease liabilities $ 3,923 $ 6,753 Non-current: Operating lease liabilities Long-term operating lease liabilities 45,236 45,407 Total operating lease liabilities $ 49,159 $ 52,160 |
Summary of components of lease expense | Year Ended Year Ended (In thousands) Classification December 31, 2023 December 31, 2022 Operating lease expense (1) Selling, general and administrative expense $ 8,548 $ 8,314 Year Ended Year Ended (In thousands) Classification December 31, 2023 December 31, 2022 Operating sublease income Selling, general and administrative expense $ 8,361 $ 5,420 (1) Represents operating lease expense before sublease income. 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, except weighted average amounts) December 31, 2023 December 31, 2022 Operating cash flows from operating leases $ 9,966 $ 9,312 Weighted average remaining lease term 6.4 years 7.4 years Weighted average discount rate 8.64 % 8.63 % |
Summary of maturities of lease liabilities | (In thousands) Year ending December 31: 2024 $ 3,897 2025 10,940 2026 11,198 2027 11,479 2028 11,739 Thereafter 16,837 Total operating lease payments $ 66,090 Less: Estimated tenant improvement allowance (6,838) Less: Imputed interest (10,093) Present value of operating lease liabilities $ 49,159 |
Sublease | |
Lessor, Lease, Description [Line Items] | |
Summary of maturities of lease liabilities | (In thousands) Year ending December 31: 2024 $ 7,944 2025 8,181 2026 8,425 2027 8,675 2028 8,412 Thereafter 10,089 Total operating sublease receipts $ 51,726 |
Sale of Equity Interests in T_2
Sale of Equity Interests in Theravance Respiratory Company, LLS and Discontinued Operations (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Sale of Equity Interests in Theravance Respiratory Company, LLC and Discontinued Operations | |
Summary of discontinued operations | Year Ended December 31, (In thousands) 2022 Income from investments in TRC, LLC $ 53,237 Transaction-related legal expenses (prior to July 20, 2022) (5,057) Interest expense on 9.5% Non-recourse notes due 2035 (21,312) Loss on extinguishment of debt (24,022) Net gain from sale of equity interests in TRC, LLC 1,141,084 Provision for income tax expense (178,974) Net income from discontinued operations $ 964,956 |
Summary of TRC's Statement of income and equity Interest | (In thousands) July 20, 2022 Assets Cash and cash equivalents $ 29,309 Related party receivables from collaborative arrangements 42,720 Total assets $ 72,029 Liabilities and LLC Members' Equity Accrued liabilities — LLC members' equity 72,029 Total liabilities and LLC members' equity $ 72,029 Period Ended (In thousands) July 20, 2022 Royalty revenue and gross profit $ 72,029 General and administrative expenses (332) Other income, net 10 Realized loss on equity and long-term investments (39,385) Changes in fair value of equity and long-term investments, net (8,884) Net Income $ 23,438 |
Ampreloxetine Funding (Tables)
Ampreloxetine Funding (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Ampreloxetine Funding. | |
Schedule of future royalty payment contingencies | (In thousands) Balance at December 31, 2022 $ 25,438 Non-cash interest expense accretion 2,350 Balance at December 31, 2023 $ 27,788 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Compensation | |
Schedule of total number of shares available for future issuance under the plans | 2013 EIP 5,339,942 2013 ESPP 2,453,502 2014 NEEIP 346,281 Total 8,139,725 |
Schedule of share-based compensation expense included in the consolidated statements of operations | Year Ended December 31, (In thousands) 2023 2022 Research and development $ 8,048 $ 12,888 Selling, general and administrative 16,966 19,848 Restructuring and related expenses 357 6,998 Total share-based compensation expense $ 25,371 $ 39,734 |
Schedule of share-based compensation expense by award type included in the consolidated statements of operations | Year Ended December 31, (In thousands) 2023 2022 Options $ 2,294 $ 2,998 RSUs 21,817 35,726 Performance RSUs 1,087 237 ESPP 173 773 Total share-based compensation expense $ 25,371 $ 39,734 |
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) Options $ 2,600 1.88 RSUs 30,404 2.36 Performance RSUs (1) 849 1.26 ESPP 504 1.05 Total $ 34,357 (1) Represents unrecognized share-based compensation cost associated with the Company’s market-based and performance-contingent awards described above that are probable of vesting. |
Summary of option activity under the 2013 EIP and 2014 NEEIP | Weighted-Average 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, 2022 2,411,893 $ 19.53 Granted 262,386 10.84 Exercised — - Forfeited (368,403) 18.85 Outstanding at December 31, 2023 2,305,876 5.32 18.65 $ 859 Exercisable at December 31, 2023 4.48 487 Vested and expected to vest at December 31, 2023 5.32 859 2023 2022 Weighted average fair value of options (in dollars) $ 5.74 $ 5.33 Total intrinsic value of options exercised (in thousands) $ — $ — |
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, 2022 4,109,847 — Granted 2,228,184 — Released (1,651,141) — Forfeited (691,140) — Outstanding at December 31, 2023 3,995,750 — |
Schedule of range of assumptions used to estimate the fair value of share options granted and rights granted | Year Ended December 31, 2023 2022 Options Risk-free interest rate 3.46% - 4.18% 1.5% - 3.8% Expected term (in years) 5.3 - 6.5 5.3 - 6.1 Volatility 53% - 55% 55% - 70% Dividend yield — — Weighted-average estimated fair value $ 5.74 $ 5.33 2013 ESPP Risk-free interest rate 4.06% - 5.39% 1.5% - 4.57% Expected term (in years) 0.5 - 2.0 0.5 - 2.0 Volatility 32% - 58% 41% - 72% Dividend yield — — Weighted-average estimated fair value $ 3.46 $ 3.86 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Income Taxes | |
Schedule of components of the income (loss) before income taxes | Year Ended December 31, (In thousands) 2023 2022 Income (loss) before provision for income taxes: United States $ 1,151 $ (40,556) Ireland (50,420) (52,168) United Kingdom — (91) Total $ (49,269) $ (92,815) |
Schedule of the components of provision for income tax expense | Year Ended December 31, (In thousands) 2023 2022 Provision for income tax (expense) benefit: Current: United States $ (2,881) $ — Ireland — (8) United Kingdom 164 (1) Subtotal (2,717) (9) Deferred: United States (3,207) — Subtotal (3,207) — Total $ (5,924) $ (9) Effective tax rate 12.02 % (0.01) % |
Schedule of the differences between the Irish statutory income tax rate for non-trading income and the Company's effective tax rates | Year Ended December 31, 2023 2022 Provision at statutory income tax rate 25.00 % 25.00 % Foreign rate differential (8.28) (6.80) Share-based compensation (3.00) (3.28) Non-deductible executive compensation (4.45) (2.79) Uncertain tax positions (7.31) (7.10) Research and development tax credit carryforwards 3.34 2.65 Change in valuation allowance (16.00) (1.01) Other (1.32) (6.68) Effective tax rate (12.02) % (0.01) % |
Significant components of the Company's deferred tax assets and liabilities | December 31, (In thousands) 2023 2022 Deferred tax assets: Net operating loss carryforwards $ 153,225 $ 141,674 Capital loss carryforwards 21,482 19,409 Research and development tax credit carryforwards 16,910 16,176 Fixed assets and intangibles 235,381 245,822 Share-based compensation 3,431 4,298 Accruals 1,186 1,795 Operating lease liabilities 10,946 11,239 Prepaid assets (248) 304 Other 4,982 30 Subtotal 447,295 440,747 Valuation allowance (429,850) (422,325) Total deferred tax assets 17,445 18,422 Deferred tax liabilities: Operating lease assets (8,076) (8,634) Future contingent milestone and royalty assets (14,512) (11,725) Total deferred tax liabilities (22,588) (20,359) Net deferred tax liabilities $ (5,143) $ (1,937) |
Reconciliation of unrecognized tax benefits | (In thousands) Unrecognized tax benefits as of December 31, 2021 $ 75,023 Gross decrease in tax positions for prior years (7,395) Gross increase in tax positions for current year 8,371 Unrecognized tax benefits as of December 31, 2022 75,999 Gross decrease in tax positions for prior years (632) Gross increase in tax positions for current year 4,103 Unrecognized tax benefits as of December 31, 2023 $ 79,470 |
Capital Return Program (Tables)
Capital Return Program (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Capital Return Program | |
Schedule of share repurchases | Year Ended December 31, (In thousands, except per share amounts) 2023 2022 Shares repurchased 18,634 2,978 Amount repurchased (excluding fees and expenses) $ 196,608 $ 32,946 Weighted average cost per share (excluding fees and expenses) $ 10.551 $ 11.062 |
2021 Corporate Restructuring _2
2021 Corporate Restructuring Completion and 2023 Strategic Actions (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
2021 Corporate Restructuring Completion and 2023 Strategic Actions | |
Schedule of information related to accrued restructuring, severance costs and one-time termination | (In thousands) Balance at December 31, 2022 $ — Net accruals 1,188 Cash paid (1,188) Balance at December 31, 2023 $ — |
SUPPLEMENTARY FINANCIAL DATA _2
SUPPLEMENTARY FINANCIAL DATA (UNAUDITED) (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
SUPPLEMENTARY FINANCIAL DATA (UNAUDITED) | |
Schedule of Supplementary Financial Data (Unaudited) | For the Quarter Ended March 31, June 30, September 30, December 31, 2023 Total revenue $ 10,417 $ 13,749 $ 15,693 $ 17,565 Costs and expenses 35,329 29,872 24,453 23,805 Loss from operations (24,912) (16,123) (8,760) (6,240) Net loss from continuing operations (22,088) (15,645) (8,950) (8,510) Net income from discontinued operations — — — — Net income (loss) (22,088) (15,645) (8,950) (8,510) Net loss from continuing operations - basic and diluted per share (0.35) (0.28) (0.17) (0.17) Net income from discontinued operations - basis and diluted per share — — — - Net income (loss) - basis and diluted per share $ (0.35) $ (0.28) $ (0.17) $ (0.17) 2022 Total revenue $ 13,196 $ 11,050 $ 12,451 $ 14,649 Costs and expenses 51,698 37,929 21,595 32,081 Loss from operations (38,502) (26,879) (9,144) (17,432) Net loss from continuing operations (41,538) (26,570) (10,460) (14,256) Net income from discontinued operations 15,592 18,379 927,091 3,894 Net income (loss) (25,946) (8,191) 916,631 (10,362) Net loss from continuing operations - basic and diluted per share (0.55) (0.35) (0.21) (0.21) Net income from discontinued operations - basis and diluted per share 0.21 0.24 12.35 0.06 Net income (loss) - basis and diluted per share $ (0.34) (0.11) 12.14 (0.15) Share of Total YUPELRI Net Sales (1) For the Quarter Ended March 31, June 30, September 30, December 31, 2023 $ 16,434 $ 19,263 $ 20,414 $ 21,225 2022 $ 15,283 $ 17,177 $ 18,698 $ 19,495 |
Organization and Summary of S_4
Organization and Summary of Significant Accounting Policies - Property and Equipment (Details) | Dec. 31, 2023 |
Equipment, furniture and fixtures | Minimum | |
Property and Equipment | |
Estimated useful life | 5 years |
Equipment, 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_5
Organization and Summary of Significant Accounting Policies - Future Royalty Payment Contingency (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | Jul. 20, 2022 |
Schedule of Equity Method Investments [Line Items] | |||
Future contingent milestone and royalty assets | $ 194,200 | $ 194,200 | |
Royalty Pharma | Disposed of by Sale | TRC | |||
Schedule of Equity Method Investments [Line Items] | |||
Future contingent milestone and royalty assets | $ 194,200 |
Organization and Summary of S_6
Organization and Summary of Significant Accounting Policies - Selling, General and Administrative Expenses (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Organization and Summary of Significant Accounting Policies | ||
Advertising expenses | $ 5.1 | $ 8 |
Organization and Summary of S_7
Organization and Summary of Significant Accounting Policies - Income Taxes (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Organization and Summary of Significant Accounting Policies | |||
US federal, state and foreign unrecognized tax benefits | $ 79,470 | $ 75,999 | $ 75,023 |
Organization and Summary of S_8
Organization and Summary of Significant Accounting Policies - Net Income (Loss) per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Numerator: | ||||||||||
Net loss from continuing operations | $ (8,510) | $ (8,950) | $ (15,645) | $ (22,088) | $ (14,256) | $ (10,460) | $ (26,570) | $ (41,538) | $ (55,193) | $ (92,824) |
Net income from discontinued operations | 964,956 | |||||||||
Net Income (Loss) | $ (8,510) | $ (8,950) | $ (15,645) | $ (22,088) | $ (10,362) | $ 916,631 | $ (8,191) | $ (25,946) | $ (55,193) | $ 872,132 |
Denominator: | ||||||||||
Weighted-average ordinary shares outstanding | 55,303 | 73,591 | ||||||||
Weighted-average ordinary shares outstanding - basic | 55,303 | 73,591 | ||||||||
Weighted-average ordinary shares outstanding - diluted | 55,303 | 73,591 | ||||||||
Continuing operations - basic (in dollars per share) | $ (0.17) | $ (0.17) | $ (0.28) | $ (0.35) | $ (0.21) | $ (0.21) | $ (0.35) | $ (0.55) | $ (1) | $ (1.26) |
Continuing operations - diluted (in dollars per share) | (0.17) | (0.17) | (0.28) | (0.35) | (0.21) | (0.21) | (0.35) | (0.55) | (1) | (1.26) |
Discontinued operations - basic (in dollars per share) | 0.06 | 12.35 | 0.24 | 0.21 | 13.11 | |||||
Discontinued operations - diluted (in dollars per share) | 0.06 | 12.35 | 0.24 | 0.21 | 13.11 | |||||
Net income (loss) per share - basic | (0.17) | (0.17) | (0.28) | (0.35) | (0.15) | 12.14 | (0.11) | (0.34) | (1) | 11.85 |
Net income (loss) per share -diluted (in dollars per share) | $ (0.17) | $ (0.17) | $ (0.28) | $ (0.35) | $ (0.15) | $ 12.14 | $ (0.11) | $ (0.34) | $ (1) | $ 11.85 |
Organization and Summary of S_9
Organization and Summary of Significant Accounting Policies - Net Loss per Share - Anti-dilutive (Details) - shares shares in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Anti-Dilutive Securities | ||
Anti-dilutive securities (in shares) | 3,916 | 5,487 |
Options | ||
Anti-Dilutive Securities | ||
Anti-dilutive securities (in shares) | 2,348 | 2,601 |
Restricted shares | ||
Anti-Dilutive Securities | ||
Anti-dilutive securities (in shares) | 1,523 | 2,851 |
Employee share purchase plan | ||
Anti-Dilutive Securities | ||
Anti-dilutive securities (in shares) | 45 | 35 |
Revenue - Viatris Agreement (De
Revenue - Viatris Agreement (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Collaborative Arrangements and Co-Promote Agreement | ||
Percentage of profit share | 35% | |
Upfront payment receivable | $ 205,000 | |
Collaboration revenue | ||
Collaborative Arrangements and Co-Promote Agreement | ||
Revenues | 57,208 | $ 48,654 |
Revefenacin Monotherapy (TD-4208) | ||
Collaborative Arrangements and Co-Promote Agreement | ||
Upfront payment receivable | 160,000 | |
Revefenacin Monotherapy (TD-4208) | Success Based Development Regulatory And Sales Milestones | ||
Collaborative Arrangements and Co-Promote Agreement | ||
Upfront payment receivable | 10,000 | |
Revefenacin Monotherapy (TD-4208) | Sales milestones | ||
Collaborative Arrangements and Co-Promote Agreement | ||
Upfront payment receivable | 150,000 | |
Future potential combination products | ||
Collaborative Arrangements and Co-Promote Agreement | ||
Upfront payment receivable | 45,000 | |
YUPELRI Monotherapy | ||
Collaborative Arrangements and Co-Promote Agreement | ||
Upfront payment receivable | $ 160,000 | |
Viatris | ||
Collaborative Arrangements and Co-Promote Agreement | ||
Percentage of profit share | 65% | |
Upfront payment receivable | $ 52,500 | |
Viatris | Future potential combination products | ||
Collaborative Arrangements and Co-Promote Agreement | ||
Upfront payment receivable | $ 7,500 | |
Viatris | YUPELRI Monotherapy | ||
Collaborative Arrangements and Co-Promote Agreement | ||
Percentage of profit share | 35% | 35% |
Upfront payment receivable | $ 45,000 | |
Revenues | 77,337 | $ 70,653 |
Viatris | YUPELRI Monotherapy | Success Based Development Regulatory And Sales Milestones | ||
Collaborative Arrangements and Co-Promote Agreement | ||
Upfront payment receivable | 7,500 | |
Viatris | YUPELRI Monotherapy | Sales milestones | ||
Collaborative Arrangements and Co-Promote Agreement | ||
Upfront payment receivable | 37,500 | |
Viatris | Collaborative Arrangement | Collaboration revenue | ||
Collaborative Arrangements and Co-Promote Agreement | ||
Revenues | 57,201 | 48,624 |
Viatris | Royalties (Non-US) | Collaboration revenue | ||
Collaborative Arrangements and Co-Promote Agreement | ||
Revenues | $ 7 | $ 30 |
Revenue - Other Collaborative A
Revenue - Other Collaborative Arrangement Revenues (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Collaboration revenue recognized in the period from: | ||
Revenue from collaborative arrangements | $ 216 | $ 192 |
Viatris | ||
Collaboration revenue recognized in the period from: | ||
Revenue from collaborative arrangements | $ 216 | 24 |
Other | ||
Collaboration revenue recognized in the period from: | ||
Revenue from collaborative arrangements | $ 168 |
Revenue - Reimbursement of R an
Revenue - Reimbursement of R and D Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Viatris | ||
Research and Development Reimbursement | ||
Total reduction to R and D expense | $ 5,723 | $ 6,682 |
Revenue - Revenue from Licensin
Revenue - Revenue from Licensing Arrangements (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2019 | |
Collaborative Arrangements and Co-Promote Agreement | |||||||||||
Total revenue | $ 17,565 | $ 15,693 | $ 13,749 | $ 10,417 | $ 14,649 | $ 12,451 | $ 11,050 | $ 13,196 | $ 57,424 | $ 51,346 | |
Pfizer | |||||||||||
Collaborative Arrangements and Co-Promote Agreement | |||||||||||
Initial cash payment | $ 10,000 | ||||||||||
Total revenue | $ 2,500 |
Segment Information - Geographi
Segment Information - Geographic region (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Segment Information | ||||||||||
Total revenue | $ 17,565 | $ 15,693 | $ 13,749 | $ 10,417 | $ 14,649 | $ 12,451 | $ 11,050 | $ 13,196 | $ 57,424 | $ 51,346 |
US | ||||||||||
Segment Information | ||||||||||
Total revenue | 57,201 | 51,124 | ||||||||
Europe | ||||||||||
Segment Information | ||||||||||
Total revenue | $ 223 | $ 222 |
Segment Information - Percentag
Segment Information - Percentage of Revenue (Details) - Viatris - Customer concentration risk | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Total revenue | ||
Segment Information | ||
Percentage of total revenues | 100% | 95% |
Accounts receivable | ||
Segment Information | ||
Percentage of total revenues | 100% | 100% |
Sale of Velusetrag (Details)
Sale of Velusetrag (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Jul. 31, 2022 | Jun. 30, 2022 | |
Sale of Velusetrag | ||||
Disposal Group, Not Discontinued Operation, Gain (Loss) on Disposal, Statement of Income or Comprehensive Income [Extensible Enumeration] | Other Nonoperating Income (Expense) | |||
Sale of Velusetrag | Disposed of by Sale | ||||
Sale of Velusetrag | ||||
Consideration from sale of velusetrag assets | $ 2.8 | |||
Remaining book value of assets | $ 0 | |||
Gain on sale of velusetrag assets | $ 2.7 | |||
Sale of Velusetrag | Disposed of by Sale | Maximum | ||||
Sale of Velusetrag | ||||
Future developmental and sales milestones | $ 105 |
Cash, Cash Equivalents, and R_3
Cash, Cash Equivalents, and Restricted Cash (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Cash, Cash Equivalents, and Restricted Cash | |||
Cash and cash equivalents | $ 39,545 | $ 298,172 | |
Restricted cash | 836 | 836 | |
Total cash, cash equivalents, and restricted cash shown on the condensed consolidated statements of cash flows | 40,381 | 299,008 | $ 90,796 |
Realized and unrealized foreign currency gain (losses) | $ 60 | $ 900 |
Investments and Fair Value Me_3
Investments and Fair Value Measurements - Available-for-sale securities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Available for sale securities: | ||
Amortized Cost | $ 89,125 | $ 303,557 |
Gross Unrealized Gains | 4 | 12 |
Gross Unrealized Losses | (69) | (27) |
Estimated Fair Value | 89,060 | 303,542 |
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract] | ||
Estimated Fair Value lesser than 12 months | 57,880 | 37,280 |
Fair value of assets transferred from Level 1 to Level 2 | 0 | |
Fair value of assets transferred from Level 2 to Level 1 | 0 | |
Estimated Fair Value Total | 57,880 | 37,280 |
Gross unrealized lesser than 12 months | (69) | (27) |
Gross unrealized loss, Total | (69) | (27) |
Marketable securities | ||
Available for sale securities: | ||
Amortized Cost | 62,946 | 83,049 |
Gross Unrealized Gains | 4 | 12 |
Gross Unrealized Losses | (69) | (27) |
Estimated Fair Value | 62,881 | 83,034 |
U.S. government securities | ||
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract] | ||
Estimated Fair Value lesser than 12 months | 29,819 | |
Estimated Fair Value Total | 29,819 | |
Gross unrealized lesser than 12 months | (29) | |
Gross unrealized loss, Total | (29) | |
U.S. government securities | Quoted Prices in Active Markets for Identical Assets, Level 1 | ||
Available for sale securities: | ||
Amortized Cost | 29,848 | 24,873 |
Gross Unrealized Gains | 8 | |
Gross Unrealized Losses | (29) | |
Estimated Fair Value | 29,819 | 24,881 |
U.S. corporate notes | ||
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract] | ||
Estimated Fair Value lesser than 12 months | 23,641 | |
Estimated Fair Value Total | 23,641 | |
Gross unrealized lesser than 12 months | (32) | |
Gross unrealized loss, Total | (32) | |
U.S. corporate notes | Significant Other Observable Inputs, Level 2 | ||
Available for sale securities: | ||
Amortized Cost | 28,670 | |
Gross Unrealized Gains | 4 | |
Gross Unrealized Losses | (32) | |
Estimated Fair Value | 28,642 | |
U.S. commercial paper | ||
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract] | ||
Estimated Fair Value lesser than 12 months | 37,280 | |
Estimated Fair Value Total | 37,280 | |
Gross unrealized lesser than 12 months | (27) | |
Gross unrealized loss, Total | (27) | |
U.S. commercial paper | Significant Other Observable Inputs, Level 2 | ||
Available for sale securities: | ||
Amortized Cost | 37,307 | |
Gross Unrealized Losses | (27) | |
Estimated Fair Value | 37,280 | |
U.S. government agency securities | ||
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract] | ||
Estimated Fair Value lesser than 12 months | 4,420 | |
Estimated Fair Value Total | 4,420 | |
Gross unrealized lesser than 12 months | (8) | |
Gross unrealized loss, Total | (8) | |
U.S. government agency securities | Significant Other Observable Inputs, Level 2 | ||
Available for sale securities: | ||
Amortized Cost | 4,428 | 20,869 |
Gross Unrealized Gains | 4 | |
Gross Unrealized Losses | (8) | |
Estimated Fair Value | 4,420 | 20,873 |
Money market funds | Quoted Prices in Active Markets for Identical Assets, Level 1 | ||
Available for sale securities: | ||
Amortized Cost | 26,179 | 220,508 |
Estimated Fair Value | $ 26,179 | $ 220,508 |
Investments and Fair Value Me_4
Investments and Fair Value Measurements - Convertible senior notes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Maturity period for marketable securities | ||
Maximum contractual maturity period | 6 months | |
Weighted average contractual maturity period | 2 months | |
Unrealized losses | ||
Net unrealized losses | $ 0 | |
Available-for-sale securities sold | $ 71,400 | $ 0 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | ||
Property and Equipment | |||
Property and equipment, gross | $ 30,650 | $ 44,711 | |
Less: accumulated depreciation | (21,582) | (32,836) | |
Property and equipment, net | 9,068 | 11,875 | |
Depreciation expense | 1,900 | 2,600 | |
Carry value | [1] | 40,621 | 63,392 |
Proceeds from the sale of property and equipment | 1,513 | 1,866 | |
Non-cash loss | 1,200 | ||
Computer equipment | |||
Property and Equipment | |||
Property and equipment, gross | 1,883 | 1,921 | |
Software | |||
Property and Equipment | |||
Property and equipment, gross | 762 | 1,088 | |
Furniture and fixtures | |||
Property and Equipment | |||
Property and equipment, gross | 1,738 | 1,674 | |
Laboratory equipment | |||
Property and Equipment | |||
Property and equipment, gross | 60 | 15,445 | |
Carry value | 2,700 | ||
Leasehold improvements | |||
Property and Equipment | |||
Property and equipment, gross | 26,207 | $ 24,583 | |
Property and equipment | |||
Property and Equipment | |||
Proceeds from the sale of property and equipment | $ 1,500 | ||
[1] Amounts include share-based compensation expense as follows: |
Leases (Details)
Leases (Details) $ in Thousands | 1 Months Ended | 12 Months Ended | ||||
Jun. 30, 2022 USD ($) ft² | May 31, 2022 USD ($) ft² | Jul. 31, 2021 USD ($) ft² | Apr. 30, 2017 USD ($) ft² | Dec. 31, 2023 USD ($) ft² building item | Dec. 31, 2022 USD ($) | |
Lessee, Lease, Description [Line Items] | ||||||
Area of leased space | ft² | 162,000 | |||||
Number of building leased | building | 2 | |||||
Tenant improvement allowance | $ 6,838 | $ 8,900 | ||||
Area of subleased property | ft² | 21,000 | |||||
Option to terminate sublease | false | |||||
Monthly base rent | $ 100 | |||||
Increase in annual base rent (as a percent) | 3% | |||||
Premium component in sublease income | $ 4,200 | |||||
Percentage of excess sublease income over lease obligations received to be shared with lessor | 50% | |||||
Premium component in sublease income to be shared with lessor | $ 2,100 | |||||
Percentage of excess sublease income over lease obligations to be retained | 50% | |||||
Expected sublease income | $ 13,100 | |||||
Decrease in operating lease liabilities | 3,001 | $ 1,024 | ||||
Sublease | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Tenant improvement allowance | 6,490 | |||||
Expects to receive base rent | $ 51,726 | |||||
Dublin | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Area of leased space | ft² | 700 | 6,100 | ||||
Annual base rent expenses | $ 200 | $ 400 | ||||
Decrease in operating lease assets | 1,400 | |||||
Decrease in operating lease liabilities | 1,500 | |||||
Loss on sale of furniture and equipment | $ 100 | |||||
Lease term | 2 years | |||||
Option to terminate | true | |||||
Lease termination notice period | 3 months | |||||
Operating lease expenses | $ 400 | |||||
South San Francisco | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Area of subleased property | ft² | 78,000 | |||||
South San Francisco | Sublease | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Option to terminate sublease | False | |||||
Monthly base rent | $ 500 | |||||
Increase in annual base rent (as a percent) | 3% | |||||
Reduction in expenses | $ 6,500 | |||||
Tenant improvement allowance | 8,900 | |||||
Expects to receive base rent | 51,700 | |||||
Premium component in sublease income | $ 13,500 | |||||
Percentage of excess sublease income over lease obligations received to be shared with lessor | 50% | |||||
Premium component in sublease income to be shared with lessor | $ 6,700 | |||||
Percentage of excess sublease income over lease obligations to be retained | 50% | |||||
Number of buildings in which office and laboratory space leased | item | 2 |
Leases - Assets and Liabilities
Leases - Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Assets and liabilities | ||
Operating lease assets | $ 36,287 | $ 40,126 |
Operating lease liabilities, current | $ 3,923 | $ 6,753 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Operating lease liabilities, current | Operating lease liabilities, current |
Operating lease liabilities | $ 45,236 | $ 45,407 |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Operating lease liabilities | Operating lease liabilities |
Total operating lease liabilities | $ 49,159 | $ 52,160 |
Leases - Lease Cost (Details)
Leases - Lease Cost (Details) - Selling, general and administrative - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Lessee, Lease, Description [Line Items] | ||
Operating lease expense | $ 8,548 | $ 8,314 |
Operating sublease income | $ 8,361 | $ 5,420 |
Leases - Supplemental informati
Leases - Supplemental information related to leases (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Leases | ||
Operating cash flows from operating leases | $ 9,966 | $ 9,312 |
Weighted-average remaining lease term (years) | 6 years 4 months 24 days | 7 years 4 months 24 days |
Weighted-average discount rate | 8.64% | 8.63% |
Leases - Maturity of Lease Liab
Leases - Maturity of Lease Liabilities and Other Information (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Lessee, Lease, Description [Line Items] | ||
2024 | $ 3,897 | |
2025 | 10,940 | |
2026 | 11,198 | |
2027 | 11,479 | |
2028 | 11,739 | |
Thereafter | 16,837 | |
Total operating lease payments | 66,090 | |
Less: Estimated tenant improvement allowance | (6,838) | $ (8,900) |
Less: Imputed interest | (10,093) | |
Present value of operating lease liabilities | 49,159 | $ 52,160 |
Sublease | ||
Lessee, Lease, Description [Line Items] | ||
Less: Estimated tenant improvement allowance | (6,490) | |
Future Undiscounted Cash Inflows | ||
2024 | 7,944 | |
2025 | 8,181 | |
2026 | 8,425 | |
2027 | 8,675 | |
2028 | 8,412 | |
Thereafter | 10,089 | |
Total operating sublease receipts | $ 51,726 |
Sale of Equity Interests in T_3
Sale of Equity Interests in Theravance Respiratory Company, LLS and Discontinued Operations (Details) | 12 Months Ended | ||
Jul. 20, 2022 USD ($) shares | Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | |
Theravance Respiratory Company, LLC | |||
Fair value of contingent consideration | $ 194,200,000 | $ 194,200,000 | |
Royalty Pharma | Disposed of by Sale | TRC | |||
Theravance Respiratory Company, LLC | |||
Consideration received | $ 1,301,600,000 | ||
Proceeds from the sale of equity interest in TRC, LLC | 1,107,400,000 | ||
Equity method investments | 136,700,000 | ||
Transaction costs | 23,800,000 | ||
Fair value of contingent consideration | 194,200,000 | ||
Investment Amount | $ 136,700,000 | ||
Royalty Pharma | Disposed of by Sale | TRC | Measurement Input, Discount Rate [Member] | |||
Theravance Respiratory Company, LLC | |||
Equity method investment, contingent consideration | 0.0783 | ||
Royalty Pharma | Purchase Agreement to Sell Units in Theravance Respiratory Company, LLC | |||
Theravance Respiratory Company, LLC | |||
Percentage of Right to Receive Royalty Transferring | 85 | ||
Proceeds from sale of units. | $ 1,100,000,000 | ||
Consideration Receivable at closing | $ 250,000,000 | ||
Consideration received | $ 200,000,000 | ||
Royalty Pharma | Class B Units | Purchase Agreement to Sell Units in Theravance Respiratory Company, LLC | |||
Theravance Respiratory Company, LLC | |||
Units issued | shares | 2,125 | ||
Royalty Pharma | Class C Units | Purchase Agreement to Sell Units in Theravance Respiratory Company, LLC | |||
Theravance Respiratory Company, LLC | |||
Units issued | shares | 6,375 | ||
TRC | |||
Theravance Respiratory Company, LLC | |||
Percentage of equity interest | 85% | ||
Percentage of economic interest | 85% | ||
Number of fiscal quarters | 4 | ||
Theravance | |||
Theravance Respiratory Company, LLC | |||
Consideration Receivable at closing | $ 1,326,600,000 |
Sale of Equity Interests in T_4
Sale of Equity Interests in Theravance Respiratory Company, LLS and Discontinued Operations - Summary of discontinued operations (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Jul. 20, 2022 | Dec. 31, 2022 | Dec. 31, 2023 | Feb. 29, 2020 | |
Schedule of Equity Method Investments [Line Items] | ||||
Provision for income tax expense | $ (178,974) | |||
Net income from discontinued operations | $ 964,956 | |||
9.5% Non-Recourse Notes Due 2035 | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Interest rate (as a percent) | 9.50% | 9.50% | ||
9.0% Non-Recourse 2033 Notes | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Interest rate (as a percent) | 9% | |||
TRC | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Income from investments in TRC, LLC | $ 53,200 | |||
Disposed of by Sale | TRC | Royalty Pharma | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Income from investments in TRC, LLC | 53,237 | |||
Transaction-related legal expenses (prior to July 20, 2022) | (5,057) | |||
Loss on extinguishment of debt | (24,022) | |||
Net gain from sale of equity interests in TRC, LLC | $ 1,141,100 | 1,141,084 | ||
Provision for income tax expense | (178,974) | |||
Net income from discontinued operations | 964,956 | |||
Disposed of by Sale | TRC | Royalty Pharma | 9.5% Non-Recourse Notes Due 2035 | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Interest expense on 9.5% Non-recourse notes due 2035 | $ (21,312) |
Sale of Equity Interests in T_5
Sale of Equity Interests in Theravance Respiratory Company, LLS and Discontinued Operations - Summary of TRC's statement of income and equity Interest (Details) - USD ($) $ in Thousands | 3 Months Ended | 7 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Jul. 20, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Assets | |||||||||||
Cash and cash equivalents | $ 39,545 | $ 298,172 | $ 39,545 | $ 298,172 | |||||||
Total assets | 381,999 | 607,400 | 381,999 | 607,400 | |||||||
Liabilities and LLC Members' Equity | |||||||||||
Total liabilities and shareholders' equity | 381,999 | 607,400 | 381,999 | 607,400 | |||||||
Revenue: | |||||||||||
Total revenue | $ 17,565 | $ 15,693 | $ 13,749 | $ 10,417 | $ 14,649 | $ 12,451 | $ 11,050 | $ 13,196 | 57,424 | 51,346 | |
Collaboration revenue | |||||||||||
Revenue: | |||||||||||
Total revenue | $ 216 | $ 192 | |||||||||
TRC | |||||||||||
Assets | |||||||||||
Total assets | $ 72,029 | ||||||||||
Liabilities and LLC Members' Equity | |||||||||||
Total liabilities and shareholders' equity | 72,029 | ||||||||||
Revenue: | |||||||||||
Total revenue | 72,029 | ||||||||||
General and administrative expenses | (332) | ||||||||||
Other income, net | 10 | ||||||||||
Realized loss on equity and long-term investments | (39,385) | ||||||||||
Changes in fair value of equity and long-term investments, net | (8,884) | ||||||||||
Net Income | 23,438 | ||||||||||
TRC | TRC | |||||||||||
Assets | |||||||||||
Cash and cash equivalents | 29,309 | ||||||||||
Related party receivables from collaborative arrangements | 42,720 | ||||||||||
Liabilities and LLC Members' Equity | |||||||||||
LLC members' equity | $ 72,029 |
Ampreloxetine Funding (Details)
Ampreloxetine Funding (Details) $ in Millions | 12 Months Ended | ||
Jul. 20, 2022 USD ($) | Dec. 31, 2023 | Dec. 31, 2022 USD ($) | |
Ampreloxetine Royalty Rights | |||
Development and Collaboration Agreement | |||
Consideration Receivable at closing | $ 25 | ||
Consideration received at the time of first approval | $ 15 | ||
Patent application period | 5 years | ||
Milestone payments | $ 15 | ||
Carrying amount of the liability | $ 25 | ||
Percent of effective interest rate | 8.80% | ||
Ampreloxetine Royalty Rights | Net Sales Upto First 500 Million | |||
Development and Collaboration Agreement | |||
Consideration received | $ 500 | ||
Royalty Payment Percentage Multiplied with Net Sales | 2.5 | ||
Ampreloxetine Royalty Rights | Net Sales In Excess of 500 Million | |||
Development and Collaboration Agreement | |||
Consideration received | $ 500 | ||
Royalty Payment Percentage Multiplied with Net Sales | 4.5 | ||
Ampreloxetine Funding | |||
Development and Collaboration Agreement | |||
Consideration Receivable at closing | $ 25 |
Ampreloxetine Funding - Schedul
Ampreloxetine Funding - Schedule of Future Royalty Payment Contingencies (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Development and Collaboration Agreement | ||
Beginning balance | $ 25,438 | |
Non-cash interest expense accretion | 2,350 | $ 974 |
Ending balance | 27,788 | 25,438 |
Ampreloxetine Royalty Rights | ||
Development and Collaboration Agreement | ||
Beginning balance | 25,438 | |
Non-cash interest expense accretion | 2,350 | |
Ending balance | $ 27,788 | $ 25,438 |
Extinguishment of Debt (Details
Extinguishment of Debt (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||||
Jul. 26, 2022 | Jul. 22, 2022 | Jul. 20, 2022 | Feb. 29, 2020 | Nov. 30, 2016 | Dec. 31, 2022 | Dec. 31, 2023 | |
Debt Instrument [Line Items] | |||||||
Loss on extinguishment of debt | $ (3,034) | ||||||
Total long-term debt | $ 0 | ||||||
9.5% Non-Recourse Notes Due 2035 | |||||||
Debt Instrument [Line Items] | |||||||
Principal amount | $ 400,000 | ||||||
Interest rate (as a percent) | 9.50% | 9.50% | |||||
Principal payment on notes | $ 400,000 | $ 399,998 | |||||
Accrued interest | 4,700 | ||||||
Early redemption premium fee | 20,000 | ||||||
Transaction costs | 200 | ||||||
Net principal | 400,000 | ||||||
Net interest shortfall | $ 30,700 | ||||||
Loss on extinguishment of debt | $ 24,000 | ||||||
3.25% Convertible Senior Notes Due 2023 | |||||||
Debt Instrument [Line Items] | |||||||
Principal amount | $ 230,000 | ||||||
Interest rate (as a percent) | 3.25% | ||||||
Principal payment on notes | $ 231,605 | ||||||
Accrued interest | $ 2,400 | ||||||
Transaction costs | 1,600 | ||||||
Loss on extinguishment of debt | 3,000 | ||||||
Proceeds from issuance of debt | $ 222,500 | ||||||
Retirement of debt | $ 230,000 | ||||||
Debt retired (as percent) | 100% | ||||||
Debt issuance costs | $ 7,500 | ||||||
TRC | Minimum | |||||||
Debt Instrument [Line Items] | |||||||
Upward tiering royalties (as a percent) | 6.50% | ||||||
TRC | Maximum | |||||||
Debt Instrument [Line Items] | |||||||
Upward tiering royalties (as a percent) | 10% |
Share-Based Compensation - Ther
Share-Based Compensation - Theravance Biopharma Equity Plans (Details) | 12 Months Ended | |||
Jun. 02, 2014 plan | Dec. 31, 2014 | Dec. 31, 2013 item shares | Dec. 31, 2023 shares | |
Share-Based Compensation | ||||
Number of plans | plan | 3 | |||
Total number of shares available for future issuance | 8,139,725 | |||
2013 Equity Incentive Plan | ||||
Share-Based Compensation | ||||
Total number of shares available for future issuance | 5,339,942 | |||
2013 Equity Incentive Plan | Employee Stock Option [Member] | ||||
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 | Employee Stock Option [Member] | Vesting after one year | ||||
Share-Based Compensation | ||||
Vesting period | 1 year | |||
Vesting of RSU (as a percent) | 25% | |||
2013 Equity Incentive Plan | Employee Stock Option [Member] | Monthly vesting over the remaining three years | ||||
Share-Based Compensation | ||||
Vesting period | 3 years | |||
Vesting of RSU (as a percent) | 75% | |||
2013 Employee Share Purchase Plan | ||||
Share-Based Compensation | ||||
Automatic increase in number of shares that may be issued | 571,428 | |||
Purchase price as a percentage of fair market value of stock | 85% | |||
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% | |||
Total number of shares available for future issuance | 2,453,502 | |||
2013 Employee Share Purchase Plan | Maximum | ||||
Share-Based Compensation | ||||
Shares that may be issued as percent of prior year outstanding shares | 1% | |||
2014 NEEIP | ||||
Share-Based Compensation | ||||
Total number of shares available for future issuance | 346,281 | |||
2014 NEEIP | Employee Stock Option [Member] | ||||
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 | Employee Stock Option [Member] | Vesting after one year | ||||
Share-Based Compensation | ||||
Vesting period | 1 year | |||
Vesting of RSU (as a percent) | 25% | |||
2014 NEEIP | Employee Stock Option [Member] | Monthly vesting over the remaining three years | ||||
Share-Based Compensation | ||||
Vesting period | 3 years | |||
Vesting of RSU (as a percent) | 75% |
Share-Based Compensation - Mark
Share-Based Compensation - Market and Performance-Contingent Awards (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2023 | |
Share-Based Compensation | |||
Share-based compensation expense | $ 1.7 | ||
Performance-Contingent Awards - RSAs | |||
Share-Based Compensation | |||
Granted (in shares) | 165,000 | ||
Fair value | $ 1.4 | ||
Share-based compensation expense | $ 0.7 | ||
RSUs | |||
Share-Based Compensation | |||
Granted (in shares) | 2,228,184 | ||
Share-based compensation expense | $ 0 | ||
Performance-Contingent Awards - RSUs | |||
Share-Based Compensation | |||
Granted (in shares) | 367,000 | 43,000 | |
Fair value | $ 3.7 | $ 0.4 | |
Share-based compensation expense | $ 0.4 | ||
Shares approved for grant (in shares) | 59,000 |
Share-Based Compensation - Shar
Share-Based Compensation - Share Based Compensation Expense By Type (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Share-Based Compensation | ||
Total share-based compensation expense | $ 25,371 | $ 39,734 |
Unrecognized compensation cost | 34,357 | |
Employee Stock Option [Member] | ||
Share-Based Compensation | ||
Total share-based compensation expense | 2,294 | 2,998 |
Unrecognized compensation cost | $ 2,600 | |
Weighted-average amortization period - years | 0 years | |
RSUs | ||
Share-Based Compensation | ||
Total share-based compensation expense | $ 21,817 | 35,726 |
Unrecognized compensation cost | $ 30,404 | |
Weighted-average amortization period - years | 0 years | |
Performance-Contingent Awards - RSAs and RSUs | ||
Share-Based Compensation | ||
Total share-based compensation expense | $ 1,087 | 237 |
Unrecognized compensation cost | $ 849 | |
Weighted-average amortization period - years | 0 years | |
ESPP | ||
Share-Based Compensation | ||
Total share-based compensation expense | $ 173 | $ 773 |
Unrecognized compensation cost | $ 504 | |
Weighted-average amortization period - years | 0 years |
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, 2023 | Dec. 31, 2022 | |
Number of Shares Subject To Outstanding Options | ||
Balance at the beginning of the year | 2,411,893 | |
Granted ( in shares) | 262,386 | |
Forfeited (in shares) | (368,403) | |
Balance at the end of the year | 2,305,876 | 2,411,893 |
Weighted-Average Exercise Price of Outstanding Options | ||
Balance at the beginning of the year (in dollars per share) | $ 19.53 | |
Granted (in dollars per share) | 10.84 | |
Forfeited (in dollars per share) | 18.85 | |
Balance at the end of the year (in dollars per share) | $ 18.65 | $ 19.53 |
Additional disclosures | ||
Weighted-Average Remaining Contractual Term (Years), Outstanding | 0 years | |
Weighted-Average Remaining Contractual Term (Years), Exercisable | 0 years | |
Weighted-Average Remaining Contractual Term (Years), Vested and expected to vest | 0 years | |
Aggregate intrinsic value of options outstanding | $ 859 | |
Aggregate intrinsic value of options exercisable | $ 487 | |
Weighted-average estimated fair value (in dollars per share) | $ 5.74 | $ 5.33 |
Aggregate intrinsic value of vested or expected to vest | $ 859 |
Share-Based Compensation - RSU
Share-Based Compensation - RSU and RSA activity (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
RSUs | ||
RSU and RSA activity ( including Performance RSUs and RSAs) | ||
Outstanding at beginning of year | 4,109,847 | |
Granted (in shares) | 2,228,184 | |
Released (in shares) | (1,651,141) | |
Forfeited (in shares) | (691,140) | |
Outstanding at end of year | 3,995,750 | 4,109,847 |
Additional disclosures | ||
Total estimated fair value of RSUs vested | $ 17.3 | $ 37.2 |
Performance-Contingent Awards - RSAs | ||
RSU and RSA activity ( including Performance RSUs and RSAs) | ||
Granted (in shares) | 165,000 |
Share-Based Compensation - Valu
Share-Based Compensation - Valuation Assumptions (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Employee Stock Option [Member] | ||
Weighted-average assumptions | ||
Risk-free interest rate, minimum (as a percent) | 3.46% | 1.50% |
Risk-free interest rate, maximum (as a percent) | 4.18% | 3.80% |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate, Minimum | 3.46% | 1.50% |
Expected volatility, minimum (as a percent) | 53% | 55% |
Expected volatility, maximum (as a percent) | 55% | 70% |
Weighted-average estimated fair value (in dollars per share) | $ 5.74 | $ 5.33 |
Minimum | Employee Stock Option [Member] | ||
Weighted-average assumptions | ||
Expected term (in years) | 5 years 3 months 18 days | 5 years 3 months 18 days |
Maximum | Employee Stock Option [Member] | ||
Weighted-average assumptions | ||
Expected term (in years) | 6 years 6 months | 6 years 1 month 6 days |
2013 Employee Share Purchase Plan | ||
Weighted-average assumptions | ||
Risk-free interest rate, minimum (as a percent) | 4.06% | 1.50% |
Risk-free interest rate, maximum (as a percent) | 4.57% | |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate, Minimum | 4.06% | 1.50% |
Expected volatility, minimum (as a percent) | 32% | 41% |
Expected volatility, maximum (as a percent) | 58% | 72% |
Weighted-average estimated fair value (in dollars per share) | $ 3.46 | $ 3.86 |
2013 Employee Share Purchase Plan | Minimum | ||
Weighted-average assumptions | ||
Expected term (in years) | 6 months | 6 months |
2013 Employee Share Purchase Plan | Maximum | ||
Weighted-average assumptions | ||
Risk-free interest rate, maximum (as a percent) | 5.39% | |
Expected term (in years) | 2 years | 2 years |
Share-Based Compensation (Detai
Share-Based Compensation (Details) $ in Thousands | 12 Months Ended | |||
May 02, 2023 shares | Dec. 31, 2023 USD ($) employee shares | Dec. 31, 2022 USD ($) shares | Sep. 30, 2023 shares | |
Share-Based Compensation | ||||
Stock-based compensation expense | $ 25,371 | $ 39,734 | ||
Share-based compensation expense | 1,700 | |||
Cumulative compensation cost | 800 | |||
2013 Equity Incentive Plan | ||||
Share-Based Compensation | ||||
Extended term of the equity incentive plan | 10 years | |||
Number of shares reserved for issuance reduced | shares | 3,808,287 | |||
Restructuring and related expenses | ||||
Share-Based Compensation | ||||
Stock-based compensation expense | 357 | $ 6,998 | ||
Share-based compensation expense | $ 2,500 | |||
Number of employees reduction in workforce | employee | 40 | |||
Performance-Contingent Awards - RSAs | ||||
Share-Based Compensation | ||||
Granted (in shares) | shares | 165,000 | |||
Fair value | $ 1,400 | |||
Share-based compensation expense | $ 700 | |||
Performance-Contingent Awards - RSUs | ||||
Share-Based Compensation | ||||
Granted (in shares) | shares | 367,000 | 43,000 | ||
Fair value | $ 3,700 | $ 400 | ||
Share-based compensation expense | 400 | |||
Shares approved for grant (in shares) | shares | 59,000 | |||
RSUs | ||||
Share-Based Compensation | ||||
Stock-based compensation expense | $ 21,817 | 35,726 | ||
Granted (in shares) | shares | 2,228,184 | |||
Share-based compensation expense | $ 0 |
Defined Contribution Plan (Deta
Defined Contribution Plan (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Defined Contribution Plan | ||
Matching contributions by employer (in percent) | 100% | |
Amount recognized in compensation expense | $ 0.5 | $ 0.6 |
Maximum | ||
Defined Contribution Plan | ||
Annual compensation of employee for which matching contribution made (in percent) | 5,000% |
Income Taxes - Components of th
Income Taxes - Components of the income (loss) before income taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Income Taxes | ||
Income (loss) before provision for income taxes | $ (49,269) | $ (92,815) |
United States | ||
Income Taxes | ||
Income (loss) before provision for income taxes | 1,151 | (40,556) |
Ireland | ||
Income Taxes | ||
Income (loss) before provision for income taxes | $ (50,420) | (52,168) |
United Kingdom | ||
Income Taxes | ||
Income (loss) before provision for income taxes | $ (91) |
Income Taxes - Components of pr
Income Taxes - Components of provision for income tax (expense) benefit (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Provision for income tax (expense) benefit | |||
Current | $ 2,717,000 | $ 9,000 | |
Deferred | (3,207,000) | ||
Income tax expense | $ (5,924,000) | $ (9,000) | |
Effective tax rate (as a percent) | 12.02% | (0.01%) | |
Income tax expense | $ 179,000,000 | ||
Unrecognized tax benefits | $ 79,470,000 | 75,999,000 | $ 75,023,000 |
Provision for income taxes on undistributed earnings of foreign subsidiaries | 0 | ||
Undistributed earnings | 0 | ||
United States | |||
Provision for income tax (expense) benefit | |||
Current | 2,881,000 | ||
Deferred | $ (3,207,000) | ||
Ireland | |||
Provision for income tax (expense) benefit | |||
Current | $ 8,000 | ||
Effective tax rate (as a percent) | (12.02%) | (0.01%) | |
United Kingdom | |||
Provision for income tax (expense) benefit | |||
Current | $ (164,000) | $ 1,000 |
Income Taxes - Irish statutory
Income Taxes - Irish statutory rate reconciliation (Details) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
The differences between the U.S. federal statutory income tax rate to the Company's effective tax rate | ||
Effective tax rate (as a percent) | 12.02% | (0.01%) |
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% | 25% |
Foreign rate differential (as a percent) | (8.28%) | (6.80%) |
Share-based compensation (as a percent) | (3.00%) | (3.28%) |
Non-deductible executive compensation (as a percent) | (4.45%) | (2.79%) |
Uncertain tax positions (as a percent) | (7.31%) | (7.10%) |
Research and development tax credit carryforwards (as a percent) | 3.34% | 2.65% |
Change in valuation allowance (as a percent) | (16.00%) | (1.01%) |
Other (as a percent) | (1.32%) | (6.68%) |
Effective tax rate (as a percent) | (12.02%) | (0.01%) |
Income Taxes - Deferred income
Income Taxes - Deferred income taxes (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Deferred tax assets: | ||
Net operating loss carryforwards | $ 153,225 | $ 141,674 |
Capital loss carryforwards | 21,482 | 19,409 |
Research and development tax credit carryforwards | 16,910 | 16,176 |
Fixed assets and intangibles | 235,381 | 245,822 |
Share-based compensation | 3,431 | 4,298 |
Accruals | 1,186 | 1,795 |
Operating lease liabilities | 10,946 | 11,239 |
Prepaid assets | (248) | 304 |
Other | 4,982 | 30 |
Subtotal | 447,295 | 440,747 |
Valuation allowance | (429,850) | (422,325) |
Total deferred tax assets | 17,445 | 18,422 |
Deferred tax liabilities: | ||
Operating lease assets | (8,076) | (8,634) |
Future contingent milestone and royalty assets | (14,512) | (11,725) |
Total deferred tax liabilities | (22,588) | (20,359) |
Net deferred tax liabilities | (5,143) | (1,937) |
Information related to valuation allowance | ||
Valuation allowance | 429,850 | $ 422,325 |
Ireland | ||
Information related to valuation allowance | ||
Net operating loss carryforwards | 1,160 | |
Unused capital allowances | 1,040,000 | |
Capital loss carryforwards | Ireland | ||
Information related to valuation allowance | ||
R&D tax credit | 65,100 | |
State | ||
Deferred tax assets: | ||
Net operating loss carryforwards | 103,800 | |
State | Research and Development | ||
Deferred tax assets: | ||
Net operating loss carryforwards | $ 25,900 |
Income Taxes - Uncertain Tax Po
Income Taxes - Uncertain Tax Positions (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Gross unrecognized tax benefits | ||
Unrecognized tax benefits at the beginning of the period | $ 75,999 | $ 75,023 |
Gross decrease in tax positions for prior years | (632) | (7,395) |
Gross increase in tax positions for current year | 4,103 | 8,371 |
Unrecognized tax benefits at the end of the period | 79,470 | 75,999 |
Unrecognized tax benefits | 65,294 | $ 64,191 |
Unrecognized tax expense related to interest or penalties | 600 | |
Unrecognized tax benefits | $ 65,300 |
Capital Return Program (Details
Capital Return Program (Details) - USD ($) | 12 Months Ended | |||||||
Nov. 22, 2022 | Nov. 21, 2022 | Sep. 28, 2022 | Sep. 20, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Feb. 28, 2023 | Sep. 30, 2022 | |
Capital Return Program | ||||||||
Share repurchase authorized amount | $ 250,000,000 | $ 325,000,000 | ||||||
Ordinary shares, par value (in dollars per share) | $ 0.00001 | $ 0.00001 | ||||||
Ordinary shares, shares outstanding (in shares) | 48,091,000 | 65,227,000 | ||||||
Consideration for repurchase | $ 197,051,000 | $ 128,830,000 | ||||||
Aggregate cost | 197,052,000 | 128,830,000 | ||||||
Net cash proceeds from sale of R&D laboratory equipment | $ 1,513,000 | $ 1,866,000 | ||||||
GSK Share Repurchase | ||||||||
Capital Return Program | ||||||||
Share repurchase authorized amount | $ 250,000,000 | |||||||
Ordinary shares, par value (in dollars per share) | $ 0.00001 | |||||||
Ordinary shares, shares outstanding (in shares) | 0 | |||||||
Shares authorized to be repurchased (in shares) | 9,644,807 | |||||||
Repurchase price (in dollars per share) | $ 9.75 | |||||||
Consideration for repurchase | $ 94,000,000 | |||||||
Modified Dutch Auction Tender Offer | ||||||||
Capital Return Program | ||||||||
Share repurchase authorized amount | $ 95,000,000 | |||||||
Repurchase price (in dollars per share) | $ 10.50 | |||||||
Share repurchase (as a percent) | 0.20% | |||||||
Repurchase of ordinary shares (in shares) | 115,967 | 115,967 | ||||||
Aggregate cost | $ 1,200,000 | |||||||
Modified Dutch Auction Tender Offer | Minimum | ||||||||
Capital Return Program | ||||||||
Repurchase price (in dollars per share) | $ 9.75 | |||||||
Modified Dutch Auction Tender Offer | Maximum | ||||||||
Capital Return Program | ||||||||
Repurchase price (in dollars per share) | $ 10.50 |
Capital Return Program - Open M
Capital Return Program - Open Market Share Repurchase Plan (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | 17 Months Ended | ||
Jan. 31, 2024 | Dec. 31, 2023 | Dec. 31, 2022 | Jan. 31, 2024 | Feb. 28, 2023 | |
Capital Return Program | |||||
Share repurchase authorized amount | $ 250,000 | $ 325,000 | |||
Amount (excluding fees and expenses) | $ 197,052 | $ 128,830 | |||
Open Market Share Repurchase Plan | |||||
Capital Return Program | |||||
Share repurchase authorized amount | $ 75,000 | ||||
Shares repurchased | 18,634,000 | 2,978,000 | 31,410,000 | ||
Amount (excluding fees and expenses) | $ 196,608 | $ 32,946 | $ 325,300 | ||
Weighted average cost per share (excluding fees and expenses | $ 10.551 | $ 11.062 | $ 10.354 | ||
Open Market Share Repurchase Plan | Subsequent Events | |||||
Capital Return Program | |||||
Shares repurchased | 38,462 | ||||
Amount (excluding fees and expenses) | $ 400 | ||||
Weighted average cost per share (excluding fees and expenses | $ 11.551 |
2021 Corporate Restructuring _3
2021 Corporate Restructuring Completion and 2023 Strategic Actions - Corporate Restructuring Completion (Details) $ in Thousands | 1 Months Ended | 12 Months Ended | ||||||
Mar. 31, 2023 ft² | Feb. 28, 2023 Program | Sep. 30, 2022 USD ($) | Sep. 30, 2021 | Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | |||
2021 Corporate Restructuring Completion and 2023 Strategic Actions | ||||||||
Reduction in workforce (as a percent) | 75% | |||||||
Restructuring costs | $ 33,000 | $ 2,743 | [1] | $ 12,838 | [1] | |||
Number of programs | Program | 2 | |||||||
Percent of Employee Reduction | 17 | |||||||
Net cash proceeds from sale of R&D laboratory equipment | 1,513 | 1,866 | ||||||
Research and Development Laboratory Equipment | ||||||||
2021 Corporate Restructuring Completion and 2023 Strategic Actions | ||||||||
R&D laboratory equipment carrying value | 2,700 | |||||||
Net cash proceeds from sale of R&D laboratory equipment | 1,500 | |||||||
Office and Laboratory Space, South San Francisco | ||||||||
2021 Corporate Restructuring Completion and 2023 Strategic Actions | ||||||||
Area of land in sublease | ft² | 42,000 | |||||||
Research and development | ||||||||
2021 Corporate Restructuring Completion and 2023 Strategic Actions | ||||||||
Restructuring costs | 16,500 | 2,700 | 5,900 | |||||
Selling, general and administrative | ||||||||
2021 Corporate Restructuring Completion and 2023 Strategic Actions | ||||||||
Restructuring costs | 16,500 | 6,900 | ||||||
Severance | ||||||||
2021 Corporate Restructuring Completion and 2023 Strategic Actions | ||||||||
Restructuring costs | 33,000 | |||||||
Employee-related separation costs | 2,700 | 12,800 | ||||||
Cash charges related to modification of equity-awards for terminated and remaining employee | 17,400 | 1,200 | 5,800 | |||||
Non-cash charges related to modification of equity-awards for terminated and remaining employee | $ 15,600 | $ 1,500 | $ 7,000 | |||||
[1] Amounts include share-based compensation expense as follows: |
2021 Corporate Restructuring _4
2021 Corporate Restructuring Completion and 2023 Strategic Actions - Accrued restructuring, severance costs and one-time termination costs (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2023 USD ($) | |
Accrued cash-related restructuring expenses | |
Net accruals | $ 1,188 |
Cash paid | $ (1,188) |
Commitments and Contingencies -
Commitments and Contingencies - Performance-Contingent Awards (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Commitments and Contingencies | ||
Guarantees and indemnifications liability | $ 0 | $ 0 |
SUPPLEMENTARY FINANCIAL DATA _3
SUPPLEMENTARY FINANCIAL DATA (UNAUDITED) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Total revenue | $ 17,565 | $ 15,693 | $ 13,749 | $ 10,417 | $ 14,649 | $ 12,451 | $ 11,050 | $ 13,196 | $ 57,424 | $ 51,346 |
Costs and expenses | 23,805 | 24,453 | 29,872 | 35,329 | 32,081 | 21,595 | 37,929 | 51,698 | 113,459 | 143,303 |
Loss from operations | (6,240) | (8,760) | (16,123) | (24,912) | (17,432) | (9,144) | (26,879) | (38,502) | (56,035) | (91,957) |
Net loss from continuing operations | 8,510 | 8,950 | 15,645 | 22,088 | 14,256 | 10,460 | 26,570 | 41,538 | 55,193 | 92,824 |
Net income from discontinued operations | 3,894 | 927,091 | 18,379 | 15,592 | 964,956 | |||||
Net Income (Loss) | $ (8,510) | $ (8,950) | $ (15,645) | $ (22,088) | $ (10,362) | $ 916,631 | $ (8,191) | $ (25,946) | $ (55,193) | $ 872,132 |
Net loss from continuing operations - basic per share | $ (0.17) | $ (0.17) | $ (0.28) | $ (0.35) | $ (0.21) | $ (0.21) | $ (0.35) | $ (0.55) | $ (1) | $ (1.26) |
Net loss from continuing operations - diluted per share | (0.17) | (0.17) | (0.28) | (0.35) | (0.21) | (0.21) | (0.35) | (0.55) | (1) | (1.26) |
Net income from discontinued operations - basis per share | 0.06 | 12.35 | 0.24 | 0.21 | 13.11 | |||||
Net income from discontinued operations - diluted per share | 0.06 | 12.35 | 0.24 | 0.21 | 13.11 | |||||
Net income (loss) - basic (in dollars per share) | (0.17) | (0.17) | (0.28) | (0.35) | (0.15) | 12.14 | (0.11) | (0.34) | (1) | 11.85 |
Net income (loss) per share -diluted (in dollars per share) | $ (0.17) | $ (0.17) | $ (0.28) | $ (0.35) | $ (0.15) | $ 12.14 | $ (0.11) | $ (0.34) | $ (1) | $ 11.85 |
Percentage of profit share | 35% | |||||||||
YUPELRI Monotherapy | ||||||||||
Total revenue | $ 21,225 | $ 20,414 | $ 19,263 | $ 16,434 | $ 19,495 | $ 18,698 | $ 17,177 | $ 15,283 | ||
Percentage of net sales | 35% | |||||||||
Mylan | ||||||||||
Percentage of profit share | 65% |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Pay vs Performance Disclosure | ||||||||||
Net Income (Loss) | $ (8,510) | $ (8,950) | $ (15,645) | $ (22,088) | $ (10,362) | $ 916,631 | $ (8,191) | $ (25,946) | $ (55,193) | $ 872,132 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Dec. 31, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |