0001558370-22-017048 | 10-Q | XBRL Viewer

Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 30, 2022	Oct. 31, 2022
Document and Entity Information
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2022
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	PO Box 309
Entity Address, Address Line Two	Ugland House, South Church Street
Entity Address, City or Town	George Town, Grand Cayman
Entity Address, Country	KY
Entity Address, Postal Zip Code	KY1-1104
City Area Code	650
Local Phone Number	808-6000
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Title of 12(b) Security	Ordinary Share $0.00001 Par Value
Trading Symbol	TBPH
Security Exchange Name	NASDAQ
Entity Common Stock, Shares Outstanding		67,365,912
Entity Central Index Key	0001583107
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q3
Amendment Flag	false

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Current assets:
Cash and cash equivalents	$ 418,538	$ 89,959
Short-term marketable securities	68,294	83,506
Receivables from collaborative arrangements	14,114	14,065
Prepaid clinical and development services	2,645	10,245
Other prepaid and current assets	8,127	8,561
Amounts due from TRC, LLC (Discontinued operations)		43,534
Total current assets	511,718	249,870
Property and equipment, net	11,884	13,657
Operating lease assets	39,992	39,690
Future contingent milestone and royalty assets	194,200
Restricted cash	836	837
Other assets	4,866	3,228
Equity in net assets of TRC, LLC (Discontinued operations)		67,537
Total assets	763,496	374,819
Current liabilities:
Accounts payable	5,337	3,098
Accrued personnel-related expenses	7,560	12,796
Accrued clinical and development expenses	4,078	17,010
Accrued general and administrative expenses	3,749	2,898
Operating lease liabilities	692	503
Deferred revenue	24	98
Current portion of non-recourse notes due 2035, net		16,940
Accrued interest payable		1,246
Other accrued liabilities	142	1,304
Income tax payable (Discontinued operations)	120,550
Accrued interest payable (Discontinued operations)		2,694
Total current liabilities	142,132	58,587
Long-term operating lease liabilities	51,381	52,681
Future royalty payment contingency	24,888
Long-term deferred revenue	199	310
Unrecognized Tax Benefits	62,661	240
Other long-term liabilities	1,657	2,180
Non-recourse notes due 2035, net		371,359
Convertible senior notes due 2023, net		228,035
Commitments and contingencies
Shareholders' Equity (Deficit)
Preferred shares, $0.00001 par value: 230 shares authorized, no shares issued or outstanding
Ordinary shares, $0.00001 par value: 200,000 shares authorized; 67,366 and 74,435 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively	1	1
Additional paid-in capital	1,324,247	1,387,469
Accumulated other comprehensive loss	(121)
Accumulated deficit	(843,549)	(1,726,043)
Total shareholders' equity (deficit)	480,578	(338,573)
Total liabilities and shareholders' equity (deficit)	$ 763,496	$ 374,819

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands	Sep. 30, 2022	Dec. 31, 2021
CONDENSED CONSOLIDATED BALANCE SHEETS
Preferred shares, par value (in dollars per share)	$ 0.00001	$ 0.00001
Preferred shares, shares authorized	230	230
Preferred shares, shares issued	0	0
Preferred shares, outstanding shares	0	0
Ordinary shares, par value (in dollars per share)	$ 0.00001	$ 0.00001
Ordinary shares, authorized shares	200,000	200,000
Ordinary shares, shares issued	67,366	74,435
Ordinary shares, shares outstanding	67,366	74,435

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Revenue:
Total revenue	$ 12,451	$ 13,194	$ 36,697	$ 40,365
Expenses:
Research and development (1)	9,867	43,739	48,691	162,431
Selling, general and administrative (1)	16,277	21,299	51,105	77,780
Restructuring and related expenses (1)	509	1,771	11,427	1,771
Total expenses	26,653	66,809	111,223	241,982
Loss from operations	(14,202)	(53,615)	(74,526)	(201,617)
Interest expense	(1,545)	(2,136)	(5,819)	(6,410)
Loss on extinguishment of debt	(3,034)		(3,034)
Interest income and other income (expense), net	2,758	(166)	4,823	771
Loss from continuing operations before income taxes	(16,023)	(55,917)	(78,556)	(207,256)
Provision for income tax benefit (expense)		7	(12)
Net loss from continuing operations	(16,023)	(55,910)	(78,568)	(207,256)
Income from discontinued operations before income taxes	1,115,016	20,602	1,143,930	39,864
Provision for income tax expense	(182,362)		(182,868)
Net income from discontinued operations	932,654	20,602	961,062	39,864
Net income (loss)	916,631	(35,308)	882,494	(167,392)
Net unrealized gain (loss) on available-for-sale investments	(76)	6	(121)	(33)
Total comprehensive income (loss)	$ 916,555	$ (35,302)	$ 882,373	$ (167,425)
Net income (loss) per share:
Continuing operations - basic	$ (0.21)	$ (0.76)	$ (1.04)	$ (3.05)
Continuing operations - diluted	(0.21)	(0.76)	(1.04)	(3.05)
Discontinued operations - basic	12.35	0.28	12.70	0.59
Discontinued operations - diluted	12.35	0.28	12.70	0.59
Net income (loss) - basis	12.14	(0.48)	11.66	(2.46)
Net income (loss) - diluted	$ 12.14	$ (0.48)	$ 11.66	$ (2.46)
Shares used to compute basic net income (loss) per share	75,515	73,574	75,678	67,945
Shares used to compute diluted net income (loss) per share	75,515	73,574	75,678	67,945
Total share-based compensation expense	$ 8,530	$ 14,370	$ 32,784	$ 45,143
Research and development
Expenses:
Restructuring and related expenses (1)	100		5,300
Net income (loss) per share:
Total share-based compensation expense	2,623	6,956	10,709	22,192
Selling, general and administrative
Expenses:
Restructuring and related expenses (1)	400		6,200
Net income (loss) per share:
Total share-based compensation expense	5,196	7,414	16,488	22,951
Restructuring and related expenses
Net income (loss) per share:
Total share-based compensation expense	711		5,587
Viatris collaboration agreement
Revenue:
Total revenue	12,445	10,397	34,010	31,716
Collaboration revenue
Revenue:
Total revenue	$ 6	$ 2,797	187	$ 8,649
Licensing revenue
Revenue:
Total revenue			$ 2,500

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' DEFICIT - USD ($) shares in Thousands, $ in Thousands	Ordinary Shares	Additional Paid-in Capital	Accumulated Other Comprehensive Income (Loss)	Accumulated Deficit	Total
Balances at Dec. 31, 2020	$ 1	$ 1,222,818	$ 47	$ (1,526,617)	$ (303,751)
Balances (in shares) at Dec. 31, 2020	64,328
Increase (Decrease) in Stockholders' Equity
Net proceeds from sale of ordinary shares		108,180			108,180
Net proceeds from sale of ordinary shares (in shares)	7,705
Proceeds from ESPP purchases		2,862			2,862
Proceeds from ESPP purchases (in shares)	188
Employee share-based compensation expense		45,143			45,143
Issuance of restricted shares (in shares)	1,978
Option exercises		5			5
Repurchase of shares to satisfy tax withholding		(8,606)			(8,606)
Repurchase of shares to satisfy tax withholding (in shares)	(501)
Net unrealized gain (loss) on marketable securities			(33)		(33)
Net income (loss)				(167,392)	(167,392)
Balances at Sep. 30, 2021	$ 1	1,370,402	14	(1,694,009)	(323,592)
Balances (in shares) at Sep. 30, 2021	73,698
Balances at Jun. 30, 2021	$ 1	1,358,318	8	(1,658,701)	(300,374)
Balances (in shares) at Jun. 30, 2021	73,470
Increase (Decrease) in Stockholders' Equity
Employee share-based compensation expense		14,370			14,370
Issuance of restricted shares (in shares)	391
Repurchase of shares to satisfy tax withholding		(2,286)			(2,286)
Repurchase of shares to satisfy tax withholding (in shares)	(163)
Net unrealized gain (loss) on marketable securities			6		6
Net income (loss)				(35,308)	(35,308)
Balances at Sep. 30, 2021	$ 1	1,370,402	14	(1,694,009)	(323,592)
Balances (in shares) at Sep. 30, 2021	73,698
Balances at Dec. 31, 2021	$ 1	1,387,469		(1,726,043)	$ (338,573)
Balances (in shares) at Dec. 31, 2021	74,435				74,435
Increase (Decrease) in Stockholders' Equity
Repurchase of ordinary shares		(94,037)			$ (94,037)
Repurchase of ordinary shares (in shares)	(9,645)
Proceeds from ESPP purchases		488			488
Proceeds from ESPP purchases (in shares)	72
Employee share-based compensation expense		32,784			32,784
Issuance of restricted shares (in shares)	2,764
Repurchase of shares to satisfy tax withholding		(2,457)			(2,457)
Repurchase of shares to satisfy tax withholding (in shares)	(260)
Net unrealized gain (loss) on marketable securities			(121)		(121)
Net income (loss)				882,494	882,494
Balances at Sep. 30, 2022	$ 1	1,324,247	(121)	(843,549)	$ 480,578
Balances (in shares) at Sep. 30, 2022	67,366				67,366
Balances at Jun. 30, 2022	$ 1	1,410,415	(45)	(1,760,180)	$ (349,809)
Balances (in shares) at Jun. 30, 2022	76,427
Increase (Decrease) in Stockholders' Equity
Repurchase of ordinary shares		(94,037)			(94,037)
Repurchase of ordinary shares (in shares)	(9,645)
Proceeds from ESPP purchases		1			1
Employee share-based compensation expense		8,530			8,530
Issuance of restricted shares (in shares)	655
Repurchase of shares to satisfy tax withholding		(662)			(662)
Repurchase of shares to satisfy tax withholding (in shares)	(71)
Net unrealized gain (loss) on marketable securities			(76)		(76)
Net income (loss)				916,631	916,631
Balances at Sep. 30, 2022	$ 1	$ 1,324,247	$ (121)	$ (843,549)	$ 480,578
Balances (in shares) at Sep. 30, 2022	67,366				67,366

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Operating activities
Net income (loss)	$ 882,494	$ (167,392)
Less: Net income from discontinued operations	(961,062)	(39,864)
Net loss from continuing operations	(78,568)	(207,256)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	3,057	4,551
Amortization and accretion income, net	(342)	9
Ampreloxetine interest accretion	424
Share-based compensation	32,784	45,143
Gain on disposal of property and equipment	(96)
Gain on sale of Velusetrag	(2,709)
Amortization of right-of-use assets	2,284	2,758
Gain from lease modification		(1,863)
Loss on extinguishment of debt	3,034
Other		35
Changes in operating assets and liabilities:
Receivables from collaborative and licensing arrangements	(49)	1,867
Prepaid clinical and development services	7,600	7,132
Other prepaid and current assets	(1,148)	(99)
Right-of-use lease assets	(2,587)
Other assets	(1,743)	(1,006)
Accounts payable	2,150	2,206
Accrued personnel-related expenses, accrued clinical and development expenses, and other accrued liabilities	(18,465)	(36,573)
Accrued interest payable	(1,246)
Deferred revenue	(186)	(8,648)
Operating lease liabilities	(1,111)	443
Other long-term liabilities	(421)	776
Net cash used in operating activities - continuing operations	(57,338)	(190,525)
Net cash used in operating activities - discontinued operations	(5,598)	25,101
Net cash used in operating activities	(62,936)	(165,424)
Investing activities
Purchases of property and equipment	(306)	(2,962)
Purchases of marketable securities	(93,260)	(104,774)
Maturities of marketable securities	108,700	221,400
Sale of short-term investments and marketable securities	5
Proceeds from the sale of Velusetrag	2,709
Proceeds from the sale of property and equipment	1,866	6
Net cash provided by investing activities - continuing operations	19,714	113,670
Net cash provided by investing activities - discontinued operations	1,095,134
Net cash provided by investing activities	1,114,848	113,670
Financing activities
Proceeds from the sale of ordinary shares, net		108,180
Repurchases of ordinary shares	(94,037)
Proceeds from ampreloxetine funding, net	24,464
Proceeds from ESPP purchases	488	2,862
Proceeds from option exercises		5
Repurchase of shares to satisfy tax withholding	(2,457)	(8,606)
Net cash (used in) provided by financing activities - continuing operations	(703,145)	91,711
Net cash used in financing activities - discontinued operations	(20,189)
Net cash (used in) provided by financing activities	(723,334)	91,711
Net increase in cash, cash equivalents, and restricted cash	328,578	39,957
Cash, cash equivalents, and restricted cash at beginning of period	90,796	82,300
Cash, cash equivalents, and restricted cash at end of period	419,374	122,257
Supplemental disclosure of cash flow information
Cash paid for interest	22,244	26,954
Cash paid (received) for income taxes, net	26	(3,814)
2035 notes
Financing activities
Principal payment on notes	(399,998)	$ (10,730)
2033 notes
Financing activities
Principal payment on notes	$ (231,605)

Organization and Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2022

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^® in people's lives.

Basis of Presentation

The Company’s condensed consolidated financial information as of September 30, 2022 and for the three and nine months ended September 30, 2022 and 2021 is unaudited but includes all adjustments (consisting only of normal recurring adjustments), which are considered necessary for a fair presentation of the financial position at such date and of the operating results and cash flows for those periods, and have been prepared in accordance with United States (“US”) generally accepted accounting principles (“GAAP”) for interim financial information. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated December 31, 2021 financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, filed with the Securities and Exchange Commission (“SEC”) on February 28, 2022.

The results for the three and nine months ended September 30, 2022 are not necessarily indicative of the results to be expected for the year ending December 31, 2022, or for any other interim period or for any future period. These condensed consolidated financial statements include the accounts of the Company and its subsidiaries, and intercompany transactions and balances have been eliminated.

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 three and nine months ended September 30, 2022 (see Note 8. Sale of Equity Interests in Theravance Respiratory Company, LLC). In accordance with GAAP, the transaction was accounted for as a sale of a financial asset. For all periods presented, the results of the sale have been included as discontinued operations on these condensed consolidated financial statements.

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 condensed consolidated financial statements and accompanying notes. Management bases its estimates on historical experience and on assumptions believed to be reasonable under the circumstances. Actual results could differ materially from those estimates.

Significant Accounting Policies

There have been no material revisions in the Company’s significant accounting policies described in Note 1 to the consolidated financial statements included in its Annual Report on Form 10-K for the year ended December 31, 2021.

Recently Adopted Accounting Pronouncements

In August 2020, the FASB issued ASU 2020-06, Debt - Debt with Conversion and other Options (Subtopic 470-20) and Derivatives and Hedging: Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”). ASU 2020-06 simplifies the complexity associated with applying GAAP for certain financial instruments with characteristics of liabilities and equity by removing certain accounting models which separate the embedded conversion features from the host contract for convertible instruments. The standard also enhances the consistency of earnings-per-share calculations by requiring that an entity use the if-converted method and that the effect of potential share settlement be included in diluted earnings-per-share calculations. ASU 2020-06 became effective for fiscal years and interim periods

within those fiscal years beginning after December 15, 2021. The Company evaluated ASU 2020-06 and determined that its adoption did not have an impact on the Company’s condensed consolidated financial statements and related disclosures.

Recently Issued Accounting Pronouncements Not Yet Adopted

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 condensed consolidated financial statements and related disclosures.

Net Income (Loss) per Share

9 Months Ended

Sep. 30, 2022

Net Income (Loss) per Share

Net Income (Loss) per Share

2. Net Income (Loss) per Share

Basic net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of shares outstanding, less ordinary shares subject to forfeiture. Diluted net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of shares outstanding, less ordinary shares subject to forfeiture, plus all additional ordinary shares that would have been outstanding, assuming dilutive potential ordinary shares had been issued for other dilutive securities.


	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands, except per share data)	2022		2021		2022		2021
Numerator:
Net loss from continuing operations	$	(16,023)	$	(55,910)	$	(78,568)	$	(207,256)
Net income from discontinued operations		932,654		20,602		961,062		39,864
Net income (loss)		916,631		(35,308)		882,494		(167,392)

Denominator:
Weighted-average ordinary shares outstanding		75,515		73,574		75,678		68,021
Less: weighted-average ordinary shares subject to forfeiture		—		—		—		(76)
Weighted-average ordinary shares outstanding - basic and diluted		75,515		73,574		75,678		67,945

Net income (loss) per ordinary share:
Continuing operations - basic and diluted	$	(0.21)	$	(0.76)	$	(1.04)	$	(3.05)
Discontinued operations - basic and diluted	$	12.35	$	0.28	$	12.70	$	0.59
Net income (loss) - basic and diluted	$	12.14	$	(0.48)	$	11.66	$	(2.46)

Anti-dilutive Securities

In accordance with ASC 260, Earnings Per Share, if a company incurred a loss related to its continuing operations, then potential ordinary shares are considered anti-dilutive for the periods in which the loss was recognized. For the three and nine months ended September 30, 2022 and 2021, the Company recognized losses from continuing operations. As a result, the following ordinary equivalent shares were not included in the computation of diluted net loss per share for both continuing operations and discontinuing operations:


	Three Months Ended September 30,		Nine Months Ended September 30,
(In thousands)	2022	2021	2022	2021
Share issuances under equity incentive plans and purchase plans	5,036	8,900	7,137	8,307
Share issuances upon the conversion of convertible senior notes	—	6,676	—	6,676
Total	5,036	15,576	7,137	14,983

Revenue

9 Months Ended

Sep. 30, 2022

Revenue

Revenue

3. Revenue

Revenue 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^® (revefenacin) inhalation solution. The Company entered into the collaboration to expand the breadth of its revefenacin development program and extend its commercial reach beyond the acute care setting. In November 2018, YUPELRI was approved by the US Food and Drug Administration (the “FDA”) for the maintenance treatment of patients with chronic obstructive pulmonary disease (“COPD”).

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 Theravance Biopharma). Outside the US (including 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 is the principal in the sales transactions, and as a result, the Company does not reflect the product sales in its condensed consolidated financial statements.

As of September 30, 2022, the Company is eligible to receive from Viatris potential global development, regulatory and sales milestone payments totaling up to $257.5 million in the aggregate, with $205.0 million associated with YUPELRI monotherapy, and $52.5 million associated with future potential combination products. Of the $205.0 million associated with monotherapy, $187.5 million relates to sales milestones based on achieving certain levels of net sales and $17.5 million relates to global development and regulatory actions. The $52.5 million associated with future potential combination products relates solely to development and regulatory actions.

The Viatris Agreement is considered to be within the scope of ASC 808, Collaborative Arrangements and partially within the scope of ASC 606, Revenue from Contracts with Customers, as the parties are active participants and exposed to the risks and rewards of the collaborative activity with a unit of account provided to Viatris as a customer. Under the terms of the Viatris Agreement, which included the delivery by the Company of a license to Viatris to develop and commercialize revefenacin in exchange for $15.0 million received in 2015, Viatris was responsible for reimbursement of the Company’s costs related to the registrational program up until the approval of the first new drug application in November 2018; thereafter, R&D expenses are shared. Performing R&D services for reimbursement is considered a collaborative activity under the scope of ASC 808. Reimbursable program costs are recognized proportionately with the performance of the underlying services and accounted for as reductions to R&D expense. For this unit of account, the Company did not recognize revenue or analogize to ASC 606 and, as such, the reimbursable program costs are excluded from the transaction price. The Company determined the license to develop and commercialize revefenacin to be a unit of account and a separate performance obligation, for which Viatris is a customer, with the $15.0 million for the delivery of the license representing the transaction price.

The future potential milestone amounts for the Viatris Agreement were not included in the transaction price, as they were all determined to be fully constrained following the concepts of ASC 606. As part of the Company’s evaluation of the development and regulatory milestones constraint, the Company determined that the achievement of such milestones is contingent upon success in future clinical trials and regulatory approvals which are not within its control and uncertain at this stage. The Company expects that the sales-based milestone payments and royalty arrangements will be recognized when the sales occur or the milestone is achieved.

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 from Viatris in connection with the commercialization of YUPELRI are recorded within the condensed consolidated statements of operations as revenue from “Viatris collaboration agreement” irrespective of whether the overall collaboration is profitable. Amounts payable to Viatris, if any, in connection with the commercialization of YUPELRI are recorded within the condensed 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. For the three and nine months ended September 30, 2022, YUPELRI continued to be profitable for the Company.

The following YUPELRI-related amounts were recognized within revenue in the Company’s condensed consolidated statements of operations:


	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands)	2022		2021		2022		2021
Viatris collaboration agreement - Amounts receivable from Viatris	$	12,445	$	10,397	$	34,010	$	31,716

While Viatris records the total net sales of YUPELRI within its consolidated financial statements, Viatris collaboration agreement revenue includes the Company’s implied 35% share of net sales of YUPELRI for the three and nine months ended September 30, 2022 of $18.7 million and $51.2 million, respectively, before deducting shared expenses. For the three and nine months ended September 30, 2021, the Company’s implied 35% share of net sales of YUPELRI were $13.8 million and $41.3 million, respectively, before deducting shared expenses.

Other Collaborative Arrangement Revenues

The Company’s other collaborative arrangement revenues consisted of:


	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands)	2022		2021		2022		2021
Alfasigma	$	—	$	3	$	169	$	10
Viatris		6		6		18		18
Janssen		—		2,788		—		8,621
Total collaboration revenue	$	6	$	2,797	$	187	$	8,649

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.

Janssen Biotech

In February 2018, the Company entered into a global co-development and commercialization agreement with Janssen Biotech, Inc. (“Janssen”) for izencitinib and related back-up compounds for inflammatory intestinal diseases, including ulcerative colitis and Crohn’s disease (the “Janssen Agreement”). The Company received an upfront payment of $100.0 million related to the Janssen Agreement. Following unfavorable Phase 3 clinical trial results for izencitinib announced in August 2021, Janssen terminated the Janssen Agreement effective January 16, 2022. As a result, the Company did not recognize any collaboration revenue related to the Janssen Agreement for the three and nine months ended September 30, 2022. For the three and nine months ended September 30, 2021, the Company recognized $2.8 million and $8.6 million, respectively, in collaboration revenue related to the Janssen Agreement.

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 expense related to the reimbursement payments:


	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands)	2022		2021		2022		2021
Viatris	$	1,657	$	1,096	$	4,736	$	1,257
Janssen		—		2,205		—		4,730
Total reduction to R&D expense, net	$	1,657	$	3,301	$	4,736	$	5,987

Revenue from Licensing Arrangements

Pfizer

In December 2019, the Company entered into a global license agreement with Pfizer Inc. (“Pfizer”) for our 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 has 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 in March 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.

As of September 30, 2022, the Company is eligible to receive up to an additional $237.5 million in development and sales milestone payments from Pfizer. In addition, the Company is eligible to receive a tiered royalty on worldwide net sales of any potential products under the license at percentage royalty rates ranging from middle single-digits to low double-digits.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-URI http://asc.fasb.org/topic&trid=49130388

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 10
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130551-203045

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (b)(2)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130556-203045

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 9
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130550-203045

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (e)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 15
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130558-203045

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

+ Details

Sale of Velusetrag

9 Months Ended

Sep. 30, 2022

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 the nine months ended September 30, 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 (expense), net” on the consolidated statements of operations.

Cash, Cash Equivalents, and Restricted Cash

9 Months Ended

Sep. 30, 2022

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 condensed consolidated balance sheets that sum to the total of the same such amounts shown on the condensed consolidated statements of cash flows.


	September 30,
(In thousands)	2022		2021
Cash and cash equivalents	$	418,538	$	121,424
Restricted cash		836		833
Total cash, cash equivalents, and restricted cash shown on the condensed consolidated statements of cash flows	$	419,374	$	122,257

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 any short and long-term marketable securities that are reported separately on the condensed consolidated balance sheets.

The increase in cash and cash equivalents, compared to the prior year period, was primarily due to the sale of the Company’s equity interest in Theravance Respiratory Company, LLC (see Note 8 for further information) in July 2022. The Company also proceeded to paydown all of its long-term debt (See Note 10 for further information) by the end of August 2022, and in September 2022, the Company initiated a $250.0 million capital return program (see Note 14 for further information).

Investments and Fair Value Measurements

9 Months Ended

Sep. 30, 2022

Investments and Fair Value Measurements

Investments and Fair Value Measurements

6. Investments and Fair Value Measurements

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:


		September 30, 2022
				Gross		Gross
		Amortized		Unrealized		Unrealized		Estimated
(In thousands)		Cost		Gains		Losses		Fair Value
US government securities	Level 1	$	3,987	$	—	$	(8)	$	3,979
Corporate notes	Level 2		12,006		—		(38)		11,968
Commercial paper	Level 2		61,377		—		(75)		61,302
Marketable securities			77,370		—		(121)		77,249
Money market funds	Level 1		397,674		—		—		397,674
Total		$	475,044	$	—	$	(121)	$	474,923


		December 31, 2021
				Gross		Gross
		Amortized		Unrealized		Unrealized		Estimated
(In thousands)		Cost		Gains		Losses		Fair Value
US government securities	Level 1	$	29,986	$	—	$	(2)	$	29,984
Corporate notes	Level 2		5,034		—		(2)		5,032
Commercial paper	Level 2		48,490		1		(1)		48,490
Marketable securities			83,510		1		(5)		83,506
Money market funds	Level 1		50,228		—		—		50,228
Total		$	133,738	$	1	$	(5)	$	133,734

As of September 30, 2022, all of the Company’s available-for-sale securities had contractual maturities within six months, and the weighted-average maturity of marketable securities was less than one month. There were no transfers between Level 1 and Level 2 during the periods presented, and there have been no material changes to the Company’s valuation techniques during the three and nine months ended September 30, 2022.

Available-for-sale debt securities with unrealized losses are summarized below:


	September 30, 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
US government securities	$	3,979	$	(8)	$	—	$	—	$	3,979	$	(8)
Corporate notes		11,968		(38)		—		—		11,968		(38)
Commercial paper		61,302		(75)		—		—		61,302		(75)
Total	$	77,249	$	(121)	$	—	$	—	$	77,249	$	(121)


	December 31, 2021
	Less than 12 Months				Greater than 12 Months				Total
			Gross				Gross				Gross
	Estimated		Unrealized		Estimated		Unrealized		Estimated		Unrealized
(In thousands)	Fair Value		Losses		Fair Value		Losses		Fair Value		Losses
US government securities	$	19,991	$	(2)	$	—	$	—	$	19,991	$	(2)
Corporate notes		5,031		(2)		—		—		5,031		(2)
Commercial paper		9,995		(1)		—		—		9,995		(1)
Total	$	35,017	$	(5)	$	—	$	—	$	35,017	$	(5)

The Company invests primarily in high credit quality and short-term maturity debt securities with the intent to hold such securities until maturity at par value. The Company does not intend to sell the investments that are currently in an unrealized loss position, and it is unlikely that it will be required to sell the investments before recovery of their amortized cost basis, which may be at maturity. The Company reviewed its available-for-sale debt securities and determined that there were no credit-related losses to be recognized as of September 30, 2022.

As of September 30, 2022, the Company’s accumulated other comprehensive income (loss) on its condensed consolidated balance sheets consisted of net unrealized gains (losses) on available-for-sale investments. For the three and nine months ended September 30, 2022 and 2021, the Company did not sell any marketable securities.

Leases

9 Months Ended

Sep. 30, 2022

Leases

Leases

7. Leases

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.

As a result of the lease modification, the Company reduced the value of its operating lease assets and liabilities in the consolidated balance sheets by $1.4 million and $1.5 million, respectively. Under the Lease Assignment, the Company sold furniture and equipment located in the Dublin office to the unaffiliated company and recognized a net loss of $0.1 million from the sale.

Following the completion of the Lease Assignment, in May 2022, the Company entered into a new operating lease agreement for approximately 700 square feet of office space in Dublin, Ireland, effective June 2022. The lease has a two year term ending in May 2024, and the Company may terminate the lease by providing three months prior written notice. Under the new lease, the Company will incur total base rent expense of approximately $0.4 million (or $0.2 million annually) which is recognized on straight-line basis over the two-year lease term. The Company’s annual straight-line base rent for its previous Dublin Lease was approximately $0.4 million annually.

South San Francisco Sublease

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 expiration of the Company’s head lease, and the subtenant has no option to extend the sublease. Under the terms of the sublease, the Company is entitled to receive an initial monthly base rent of $0.5 million which will be subject to annual increases of 3%, as well as the subtenant’s proportionate share of the property’s operating expenses. The Company expects to receive a total of $51.7 million in base rent over the sublease term which represents a $13.5 million premium over its proportionate lease payment obligations under the head lease. Under the terms of the head lease, 50% of the sublease premium, equal to $6.7 million, shall be shared with the landlord and 50% shall be retained by the Company which equates to a base rent savings of approximately $0.8 million annually. The Company recognizes the sublease income on a straight-line basis over the term of the sublease 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 agreement because the Company was not released, either fully or in part, from its obligations under the head lease.

Sublease income related to this sublease agreement, including base rent and certain sublease transaction cost reimbursements from the landlord, was $1.6 million and $1.9 million for the three and nine months ended September 30, 2022, respectively. The following table summarizes the future undiscounted cash inflows relating to the sublease agreement as of September 30, 2022:


(In thousands)
Year ending December 31:
2022	$	3,554
2023		6,495
2024		6,495
2025		6,495
2026		6,495
Thereafter		22,192
Total operating sublease receipts	$	51,726

Sale of Equity Interests in Theravance Respiratory Company, LLC and Discontinued Operations

9 Months Ended

Sep. 30, 2022

Sale of Equity Interests in Theravance Respiratory Company, LLC and Discontinued Operations

Sale of Equity Interests in Theravance Respiratory Company, LLC and Discontinued Operations

8. Sale of Equity Interests in Theravance Respiratory Company, LLC and Discontinued Operations

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 Theravance Respiratory Company, LLC (“TRC”) to, and entered into a sale of future royalties from sales of ampreloxetine (see Note 9 below) with, Royalty Pharma Investments 2019 ICAV, an Irish collective asset-management vehicle (“Royalty Pharma”), pursuant to the Equity Purchase and Funding Agreement, dated as of July 13, 2022 (including the schedules and exhibits thereto, the “Purchase Agreement”), by and between the Company and Royalty Pharma (collectively with the other transactions contemplated by the Purchase Agreement, the “TRC Transaction”). The Issuer II Units represent the right to receive 85% of the royalty payments on worldwide net sales of Assigned Collaboration Products (as defined in the Purchase Agreement) pursuant to the terms of that certain Collaboration Agreement, dated as of November 14, 2002, by and between Innoviva, Inc. (formerly known as Theravance, Inc.), a Delaware corporation (“Innoviva”), and Glaxo Group Limited, a private company limited by shares registered under the laws of England and Wales (“GSK”) (as amended, the “Collaboration Agreement”). Assigned

Collaboration Products is primarily comprised of Trelegy ELLIPTA (“TRELEGY”). Total consideration payable by Royalty Pharma under the terms of the TRC Transaction included initial consideration of $1,326.6 million plus additional payments as further described below.

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 ending 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. 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, (“ASC 860”) and determined that the future potential Milestone Payments and royalty payments are considered a form of continuing involvement between the Company and Royalty Pharma. The Company further evaluated the TRC Transaction under ASC 860 and concluded that (i) the equity interests in TRC have been isolated from the Company (even in the event of bankruptcy or other receivership); (ii) Royalty Pharma has the right to pledge or exchange the TRC assets it received from the Company without constraint; and (iii) the Company had surrendered control over its equity interests in TRC to Royalty Pharma. Based on the Company’s evaluation under ASC 860, the TRC Transaction was treated as a sale, and the Company recognized a gain from the sale of its equity interests in TRC of $1,141.1 million based on the excess of the total net consideration allocated to the sale of the Company’s equity interests (based on relative fair value) of $1,301.6 million over the carrying value of the equity interests sold of $136.7 million, less transaction costs of $23.8 million. The total net consideration of $1,301.6 million included upfront cash of $1,107.4 million, plus an estimated $194.2 million representing the fair value of the future Milestone Payments and royalties (collectively, “Contingent Consideration”).

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 significant unobservable inputs included estimates of the forecasted TRELEGY net revenues, the expected volume and term of the royalty stream, and the royalty rate. These estimates are considered Level 3 fair value inputs. The Company will reassess 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 September 30, 2022, there were no changes in the carrying value of the Contingent Consideration since its initial measurement date.

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 condensed consolidated balance sheets as future contingent milestone and royalty assets.

Discontinued Operations

On July 20, 2022, the Company completed a monetization of its ownership in a significant equity method investment that had a major effect on the Company’s financial results (see Note 8 for more information). In accordance with GAAP, the sale was accounted for as an asset disposal.

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 condensed consolidated financial statements.

The results of discontinued operations consisted of the following:


	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands)	2022		2021		2022		2021
Income from investments in TRC, LLC	$	—	$	30,208	$	53,237	$	68,681
Transaction-related legal expenses (prior to July 20, 2022)		—		—		(5,057)		—
Interest expense on 9.5% Non-recourse notes due 2035		(2,046)		(9,606)		(21,312)		(28,817)
Loss on extinguishment of debt		(24,022)		—		(24,022)		—
Net gain from sale of equity interests in TRC, LLC		1,141,084		—		1,141,084		—
Provision for income tax expense		(182,362)		—		(182,868)		—
Net income from discontinued operations	$	932,654	$	20,602	$	961,062	$	39,864

TRC Summary 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 condensed consolidated financial statements. The Company’s maximum exposure to loss, as a result of its involvement with TRC, were the amounts recorded in the condensed consolidated balance sheets within “Equity in net assets of TRC, LLC”. TRC was recognized in the Company’s condensed consolidated financial statements under the equity method of accounting.

Rule 3-09 of Regulation S-X requires that a company include summary financial information for equity method investees when such investees are individually significant for a company. For the prior year comparable periods and the current year period through the TRC disposal date, the income from the Company’s investment in TRC was determined to be significant. As a result, TRC’s summary financial information, including the portion of equity interest that the Company did not own, was as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands)	2022		2021		2022		2021
Royalty revenue and gross profit	$	—	$	35,585	$	72,029	$	84,055
Income from continuing operations		—		35,391		71,693		80,244
Net income		—		35,539		62,632		79,655

Ampreloxetine Funding

9 Months Ended

Sep. 30, 2022

Ampreloxetine Funding.

Ampreloxetine Funding

9. Ampreloxetine Funding

As part of the Purchase Agreement (see Note 8 above), the Company received $25.0 million in cash from Royalty Pharma in exchange for certain royalty rights to ampreloxetine and is entitled to receive an additional $15.0

million upon the first regulatory approval of any pharmaceutical product that contains ampreloxetine as an active pharmaceutical ingredient by either (a) the FDA or (b) the first of (i) the European Medicines Agency or (ii) all four of Germany, France, Italy and Spain. In exchange for the $25.0 million and potential $15.0 million in cash (the “Ampreloxetine Funding”), the Company will make quarterly royalty payments to Royalty Pharma equal to the amount of Ampreloxetine Net Sales (as defined in the Purchase Agreement) recognized during the applicable quarter multiplied by 2.5% for the first $500.0 million in Ampreloxetine Net Sales and 4.5% for Ampreloxetine Net Sales in excess of $500.0 million. These royalty payments from the Company to Royalty Pharma will continue until, on a country by country and product by product basis, the later of (a) the expiration of all valid and enforceable claims of any patent, or pending claim of a good faith patent application during the five (5) years from the initial filing of such application, that cover the applicable 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 funding received from Royalty Pharma as a liability because the Company has significant continuing involvement in generating the future revenue stream from which the 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 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 liability for the future royalty payment contingency 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) 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 liability was initially recorded as $25.0 million, net of allocated transaction costs, and was reported on the consolidated balance sheets as future royalty payment contingency. The imputed effective rate of interest on the unamortized portion of the liability was 8.5% as of September 30, 2022.

The Company periodically reassesses the amount and timing of estimated royalty payments. To the extent such payments are greater or less than the Company's initial estimates or the timing of such payments is materially different than those estimates, the Company will prospectively adjust the amortization of the liability and the effective interest rate.

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 are not within the Company's control. The liability was recognized using significant unobservable inputs. These inputs were derived using internal management estimates and reflect management’s judgements and forecasts. The significant unobservable inputs include the forecasted revenues, the probability and timing of the regulatory milestone, the expected term of the royalty stream, and the royalty rate, as well as the overall probability of ampreloxetine’s success. These estimates are considered Level 3 fair value inputs. A significant change in unobservable inputs could result in a material increase or decrease to the effective interest rate of the liability.

Changes to the liability for sale of future royalties were as follows for the three and nine months ended September 30, 2022:


(In thousands)
Beginning balance at July 20, 2022	$	—
Consideration allocated, less transaction costs of $0.5 million		24,464
Interest accretion		424
Balance at September 30, 2022	$	24,888

Extinguishment of Debt

9 Months Ended

Sep. 30, 2022

Extinguishment of Debt

Extinguishment of Debt

10. Extinguishment of Debt

9.5% Non-Recourse Notes Due 2035

On February 21, 2020, Theravance Biopharma R&D, Inc. (“Theravance R&D”), a wholly-owned subsidiary of the Company, and Triple Royalty Sub II LLC (the “Issuer II” or “Triple II”), a wholly-owned subsidiary of Theravance Biopharma R&D, entered into certain note purchase agreements (“Note Purchase Agreements”) with certain note purchasers (“Note Purchasers”), relating to the private placement by Issuer II of $400.0 million 9.5% Fixed Rate Term Notes due on or before 2035 (the “Non-Recourse 2035 Notes”). Ninety-five percent of the Non-Recourse 2035 Notes were sold to the Note Purchasers pursuant to the Note Purchase Agreements. The remaining 5% of the Non-Recourse 2035 Notes (the “Retained Notes”) were retained by the Company to comply with Regulation RR — Credit Risk Retention (17 C.F.R. Part 246) and eliminated in the Company’s condensed consolidated financial statements.

The Non-Recourse 2035 Notes were secured by all of Issuer II’s right, title and interest as a holder of certain membership interests (the “Issuer II Class C Units”) in TRC. TRC 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 8), the Company held an 85% economic interest in TRC. The Issuer II Class C Units represented 75% of the Company's 85% economic interest, which equated to 63.75% of the economic interests in TRC.

The Non-Recourse 2035 Notes were not convertible into Company equity and had no security interest in nor rights under any agreement with GSK. The Non-Recourse 2035 Notes were redeemable by Issuer II on and after February 28, 2022, in whole or in part, at specified redemption premiums.

The source of principal and interest payments for the Non-Recourse 2035 Notes were the future royalty payments generated from the TRELEGY program, and as a result, the holders of the Non-Recourse 2035 Notes had no recourse against the Company even if the TRELEGY payments were insufficient to cover the principal and interest payments for the Non-Recourse 2035 Notes. Prior to and including the December 5, 2024 payment date, in the event that the distributions received by the Issuer II from TRC in a quarter were less than the interest accrued for that quarter, the principal amount of the Non-Recourse 2035 Notes increased by the interest shortfall amount for that quarter. While the holders of the Non-Recourse 2035 Notes had no recourse against the Company, the terms of the Non-Recourse 2035 Notes also provided that the Company, at its option, could satisfy the quarterly interest payment obligations by making a capital contribution to the Issuer II.

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 is included within discontinued operations in the accompanying consolidated statements of operations for the three and nine-months ended September 30, 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

On July 26, 2022, subsequent to the closing of the TRC Transaction, the Company launched a tender offer to retire the Company's $230.0 million of 3.25% convertible senior notes due in 2023 (“Convertible Senior 2023 Notes”) (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 the Company 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 under the caption loss on extinguishment of debt in the accompanying consolidated statements of operations for the three and nine-months ended September 30, 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.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

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+ Details

Share-Based Compensation

9 Months Ended

Sep. 30, 2022

Share-Based Compensation

Share-Based Compensation

11. Share-Based Compensation

Performance-Contingent Awards

The Company periodically grants performance-contingent share-based awards to employees. For the three and nine months ended September 30, 2022, the Company recognized $0.4 million and $0.6 million, respectively, of share-based compensation expense related to these types of awards. As of September 30, 2022, there were 305,000 shares of performance-contingent restricted share units (“RSUs”) outstanding that have a maximum remaining share-based compensation expense of $2.1 million with performance vesting dates through February 2027. For the three and nine months ended September 30, 2021, the Company recognized $0.1 million and $0.7 million, respectively, of share-based compensation expense related to performance-contingent share-based awards.

Share-Based Compensation Modification Due to Corporate Restructuring

As a result of the Company’s corporate restructuring announcement in September 2021 (see Note 13), 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) which resulted in a fair value of $2.5 million, as of the modification date, that was recorded in “Restructuring and related expenses” within the condensed consolidated statements of operations. The total cumulative compensation cost previously recognized for these awards of $0.8 million within “Research and development” and “Selling, general and administrative” expenses through the modification date, was reversed. The acceleration resulted in net incremental share-based compensation expenses of $1.7 million for nine months ended September 30, 2022 and impacted approximately 45 terminated employees who met the conditions of the acceleration and departed the Company in the first half of 2022. There were no net incremental share-based compensation expenses related to the acceleration for the three months ended September 30, 2022.

Income Taxes

9 Months Ended

Sep. 30, 2022

Income Taxes

Income Taxes

12. Income Taxes

For the three and nine months ended September 30, 2022, the Company recognized income tax expense of $182.4 million and $182.9 million, respectively. The income tax expense for the three and nine months ended September 30, 2022 was primarily attributed to the Company’s gain from the TRC Transaction, partially offset by the release of beginning of the year valuation allowance on US federal and state (excluding California) deferred tax assets. Of the $182.9 million tax expense, $62.3 million was a deferred tax expense related to the utilization of tax attributes that were previously offset by an unrecognized tax benefit.

The Company’s $62.7 million liability for unrecognized tax benefits 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.

As of September 30, 2022, the amount of uncertain tax benefit, that if realized would affect the effective tax rate, was $62.7 million and was primarily due to the gain from the TRC Transaction.

No provision for income taxes has been recognized on undistributed earnings of the Company’s foreign subsidiaries as the Company considers such earnings to be indefinitely reinvested.

The Company follows the accounting guidance related to accounting for income taxes which requires that a company reduces its deferred tax assets by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some portion or all of its deferred tax assets will not be realized. During the three months ended September 30, 2022, the Company concluded that the valuation allowance related to its US federal and state deferred tax (excluding California) assets was no longer needed primarily due to the current year gain and forecasted future taxable income from the TRC Transaction. Accordingly, the Company has recognized a non-recurring tax benefit of $61.9 million related to the valuation allowance reversal.

As of September 30, 2022, the Company continued to maintain a full valuation allowance on its foreign and California deferred tax assets.

The Company records liabilities related to uncertain tax positions in accordance with the income tax guidance which clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements by prescribing a minimum recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Resolution of one or more of these uncertain tax positions in any period may have a material impact on the results of operations for that period. The Company includes any applicable interest and penalties within the provision for income taxes in the condensed consolidated statements of operations.

The Company was recently under Internal Revenue Service (“IRS”) examination for the tax year ended December 31, 2018. On July 21, 2022, the IRS informed the Company that the examination was completed and no adjustments to its 2018 tax return were necessary.

The Company’s future income tax expense may be affected by such factors as changes in tax laws, its business, regulations, tax rates, interpretation of existing laws or regulations, the impact of accounting for share-based compensation, the impact of accounting for business combinations 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.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

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+ Details

Corporate Restructuring Update

9 Months Ended

Sep. 30, 2022

Corporate Restructuring Update

Corporate Restructuring Update

13. Corporate Restructuring Update

On September 15, 2021, the Company announced a strategic update and corporate restructuring (the “Restructuring”) to focus on leveraging its expertise in developing and commercializing respiratory therapeutics. As part of the Restructuring, the Company initiated an approximate 75% reduction in workforce. A majority of the reduction in workforce occurred in November 2021, and the remainder was completed in February 2022.

For the three and nine months ended September 30, 2022, the Company incurred Restructuring and related expenses of $0.5 million and $11.4 million, respectively, of which $0.1 million and $5.3 million were related to R&D expenses and $0.4 million and $6.2 million were related to selling, general and administrative expenses, respectively. Of the total $0.5 million, net, recognized for the three months ended September 30, 2022, cash-related credits were $0.2 million and non-cash expenses were $0.7 million which were primarily related to the modification of equity-based awards for employees affected by the Restructuring and certain related awards for other employees. Of the total $11.4 million recognized for the nine months ended September 30, 2022, cash-related expenses were $5.8 million and non-cash expenses were $5.6 million which were also primarily related to the modification of equity-based awards for employees affected by the Restructuring and certain related awards for other employees.

Since the Restructuring was announced and through its completion in September 2022, the Company has incurred total Restructuring and related expenses of $31.6 million of which $15.8 million was each related to R&D expenses and selling, general and administrative expenses. Of the total $31.6 million, cash-related expenses were $17.4 million and non-cash expenses were $14.2 million, which were primarily related to the modification of equity-based awards. As of September 30, 2022, all Restructuring and related expenses have been fully recognized by the Company.

Selected information relating to accrued cash-related Restructuring expenses was as follows:


(In thousands)
Balance at December 31, 2021	$	9,550
Net accruals		6,074
Cash paid		(15,624)
Balance at September 30, 2022	$	—

The Company also evaluated the impact of the Restructuring on the carrying value of its long-lived assets, such as property and equipment and operating lease assets. This process included evaluating the estimated remaining lives, significant changes in the use, and potential impairment charges related to its long-lived assets. Based on its evaluation, the Company determined that its long-lived assets were not impaired as of September 30, 2022, and it has not recognized any impairment charges related to its long-lived assets since the Restructuring announcement.

Capital Return Program

9 Months Ended

Sep. 30, 2022

Capital Return Program

Capital Return Program

14. 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. The Company expects to fund the capital return program with cash on hand.

GSK Share Repurchase

On September 20, 2022, the Company repurchased 9,644,807 ordinary shares, par value $0.00001 per share (“Shares”), 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 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 is offering to purchase up to $95.0 million of its 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 will expire at midnight, New York City time, at the end of the day on November 17, 2022, or any other date and time to which the Company extends such Offer, unless earlier terminated.

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 will determine the lowest per-share price that will enable it to purchase up to $95.0 million of Shares, or if a lesser value of shares is validly tendered, all Shares that have been validly tendered and not validly withdrawn. All Shares accepted in the Offer will be purchased at the same price even if tendered at a lower price.

As of September 27, 2022, the Company had 67,365,912 Shares outstanding, which reflects the impact of the Company's previous repurchase of 9,644,807 Shares from GSK Finance on September 20, 2022 (see above). If the Offer is fully subscribed, (1) at the maximum purchase price of $10.50 per share, the Company could purchase 9,047,619 Shares, which would represent approximately 13.4% of Shares outstanding or (2) at the minimum purchase price of $9.75 per share, the Company could purchase 9,743,589 Shares, which would represent approximately 14.5% of the Shares outstanding.

The Offer is not conditioned on any minimum number of Shares tendered, but is conditioned upon the satisfaction of certain customary conditions, as more fully described in the Offer to Purchase. The Company expressly reserves the right for any reason, subject to applicable law and as set forth in the Offer to Purchase, to extend, abandon, terminate or amend the Offer. Any Shares purchased pursuant to the Offer will be cancelled, and those Shares will cease to be outstanding.

Open Market Share Repurchase Plan

Subsequent to the closing of the Offer, the Company plans to engage in open market share repurchases from time to time of up to approximately $60.0 million of its Shares in compliance with Rule 10b-18 under the Securities Exchange Act, with a current goal to complete this element of the capital return program by the end of 2023. There were no shares repurchased under the Open Market Stock Repurchase Plan as of September 30, 2022.

Organization and Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2022
Organization and Summary of Significant Accounting Policies.
Basis of Presentation	Basis of Presentation The Company’s condensed consolidated financial information as of September 30, 2022 and for the three and nine months ended September 30, 2022 and 2021 is unaudited but includes all adjustments (consisting only of normal recurring adjustments), which are considered necessary for a fair presentation of the financial position at such date and of the operating results and cash flows for those periods, and have been prepared in accordance with United States (“US”) generally accepted accounting principles (“GAAP”) for interim financial information. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated December 31, 2021 financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, filed with the Securities and Exchange Commission (“SEC”) on February 28, 2022. The results for the three and nine months ended September 30, 2022 are not necessarily indicative of the results to be expected for the year ending December 31, 2022, or for any other interim period or for any future period. These condensed consolidated financial statements include the accounts of the Company and its subsidiaries, and intercompany transactions and balances have been eliminated. 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 three and nine months ended September 30, 2022 (see Note 8. Sale of Equity Interests in Theravance Respiratory Company, LLC). In accordance with GAAP, the transaction was accounted for as a sale of a financial asset. For all periods presented, the results of the sale have been included as discontinued operations on these condensed consolidated financial statements.
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 condensed consolidated financial statements and accompanying notes. Management bases its estimates on historical experience and on assumptions believed to be reasonable under the circumstances. Actual results could differ materially from those estimates.
Significant Accounting Policies	Significant Accounting Policies There have been no material revisions in the Company’s significant accounting policies described in Note 1 to the consolidated financial statements included in its Annual Report on Form 10-K for the year ended December 31, 2021.
Recently Adopted Accounting Pronouncements and Recently Issued Accounting Pronouncements Not Yet Adopted	Recently Adopted Accounting Pronouncements In August 2020, the FASB issued ASU 2020-06, Debt - Debt with Conversion and other Options (Subtopic 470-20) and Derivatives and Hedging: Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”). ASU 2020-06 simplifies the complexity associated with applying GAAP for certain financial instruments with characteristics of liabilities and equity by removing certain accounting models which separate the embedded conversion features from the host contract for convertible instruments. The standard also enhances the consistency of earnings-per-share calculations by requiring that an entity use the if-converted method and that the effect of potential share settlement be included in diluted earnings-per-share calculations. ASU 2020-06 became effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2021. The Company evaluated ASU 2020-06 and determined that its adoption did not have an impact on the Company’s condensed consolidated financial statements and related disclosures. Recently Issued Accounting Pronouncements Not Yet Adopted 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 condensed consolidated financial statements and related disclosures.

Net Income (Loss) per Share (Tables)

9 Months Ended

Sep. 30, 2022

Net Income (Loss) per Share

Schedule of basic and diluted net income (loss) per share


	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands, except per share data)	2022		2021		2022		2021
Numerator:
Net loss from continuing operations	$	(16,023)	$	(55,910)	$	(78,568)	$	(207,256)
Net income from discontinued operations		932,654		20,602		961,062		39,864
Net income (loss)		916,631		(35,308)		882,494		(167,392)

Denominator:
Weighted-average ordinary shares outstanding		75,515		73,574		75,678		68,021
Less: weighted-average ordinary shares subject to forfeiture		—		—		—		(76)
Weighted-average ordinary shares outstanding - basic and diluted		75,515		73,574		75,678		67,945

Net income (loss) per ordinary share:
Continuing operations - basic and diluted	$	(0.21)	$	(0.76)	$	(1.04)	$	(3.05)
Discontinued operations - basic and diluted	$	12.35	$	0.28	$	12.70	$	0.59
Net income (loss) - basic and diluted	$	12.14	$	(0.48)	$	11.66	$	(2.46)

Schedule of anti-dilutive securities


	Three Months Ended September 30,		Nine Months Ended September 30,
(In thousands)	2022	2021	2022	2021
Share issuances under equity incentive plans and purchase plans	5,036	8,900	7,137	8,307
Share issuances upon the conversion of convertible senior notes	—	6,676	—	6,676
Total	5,036	15,576	7,137	14,983

Revenue (Tables)

9 Months Ended

Sep. 30, 2022

Revenue

Schedule of revenue recognized from collaborative arrangements


	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands)	2022		2021		2022		2021
Viatris collaboration agreement - Amounts receivable from Viatris	$	12,445	$	10,397	$	34,010	$	31,716

Schedule of collaborative amounts were recorded in the Company's condensed consolidated statements of operations


	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands)	2022		2021		2022		2021
Alfasigma	$	—	$	3	$	169	$	10
Viatris		6		6		18		18
Janssen		—		2,788		—		8,621
Total collaboration revenue	$	6	$	2,797	$	187	$	8,649

Summary of the reductions to R&D costs related to reimbursement payments


	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands)	2022		2021		2022		2021
Viatris	$	1,657	$	1,096	$	4,736	$	1,257
Janssen		—		2,205		—		4,730
Total reduction to R&D expense, net	$	1,657	$	3,301	$	4,736	$	5,987

Cash, Cash Equivalents, and Restricted Cash (Tables)

9 Months Ended

Sep. 30, 2022

Cash, Cash Equivalents, and Restricted Cash

Schedule of reconciliation of cash, cash equivalents, and restricted cash


	September 30,
(In thousands)	2022		2021
Cash and cash equivalents	$	418,538	$	121,424
Restricted cash		836		833
Total cash, cash equivalents, and restricted cash shown on the condensed consolidated statements of cash flows	$	419,374	$	122,257

Investments and Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2022

Investments and Fair Value Measurements

Schedule of available-for-sale securities


		September 30, 2022
				Gross		Gross
		Amortized		Unrealized		Unrealized		Estimated
(In thousands)		Cost		Gains		Losses		Fair Value
US government securities	Level 1	$	3,987	$	—	$	(8)	$	3,979
Corporate notes	Level 2		12,006		—		(38)		11,968
Commercial paper	Level 2		61,377		—		(75)		61,302
Marketable securities			77,370		—		(121)		77,249
Money market funds	Level 1		397,674		—		—		397,674
Total		$	475,044	$	—	$	(121)	$	474,923


		December 31, 2021
				Gross		Gross
		Amortized		Unrealized		Unrealized		Estimated
(In thousands)		Cost		Gains		Losses		Fair Value
US government securities	Level 1	$	29,986	$	—	$	(2)	$	29,984
Corporate notes	Level 2		5,034		—		(2)		5,032
Commercial paper	Level 2		48,490		1		(1)		48,490
Marketable securities			83,510		1		(5)		83,506
Money market funds	Level 1		50,228		—		—		50,228
Total		$	133,738	$	1	$	(5)	$	133,734

Schedule of Available for sale debt securities with unrealized losses


	September 30, 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
US government securities	$	3,979	$	(8)	$	—	$	—	$	3,979	$	(8)
Corporate notes		11,968		(38)		—		—		11,968		(38)
Commercial paper		61,302		(75)		—		—		61,302		(75)
Total	$	77,249	$	(121)	$	—	$	—	$	77,249	$	(121)


	December 31, 2021
	Less than 12 Months				Greater than 12 Months				Total
			Gross				Gross				Gross
	Estimated		Unrealized		Estimated		Unrealized		Estimated		Unrealized
(In thousands)	Fair Value		Losses		Fair Value		Losses		Fair Value		Losses
US government securities	$	19,991	$	(2)	$	—	$	—	$	19,991	$	(2)
Corporate notes		5,031		(2)		—		—		5,031		(2)
Commercial paper		9,995		(1)		—		—		9,995		(1)
Total	$	35,017	$	(5)	$	—	$	—	$	35,017	$	(5)

Leases (Tables)

9 Months Ended

Sep. 30, 2022

Sublease

Lessor, Lease, Description [Line Items]

Schedule of future undiscounted cash inflows relating to sublease agreement


(In thousands)
Year ending December 31:
2022	$	3,554
2023		6,495
2024		6,495
2025		6,495
2026		6,495
Thereafter		22,192
Total operating sublease receipts	$	51,726

Sale of Equity Interests in Theravance Respiratory Company, LLC and Discontinued Operations (Tables)

9 Months Ended

Sep. 30, 2022

Sale of Equity Interests in Theravance Respiratory Company, LLC and Discontinued Operations

Summary of discontinued operations


	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands)	2022		2021		2022		2021
Income from investments in TRC, LLC	$	—	$	30,208	$	53,237	$	68,681
Transaction-related legal expenses (prior to July 20, 2022)		—		—		(5,057)		—
Interest expense on 9.5% Non-recourse notes due 2035		(2,046)		(9,606)		(21,312)		(28,817)
Loss on extinguishment of debt		(24,022)		—		(24,022)		—
Net gain from sale of equity interests in TRC, LLC		1,141,084		—		1,141,084		—
Provision for income tax expense		(182,362)		—		(182,868)		—
Net income from discontinued operations	$	932,654	$	20,602	$	961,062	$	39,864

Summary financial information


	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands)	2022		2021		2022		2021
Royalty revenue and gross profit	$	—	$	35,585	$	72,029	$	84,055
Income from continuing operations		—		35,391		71,693		80,244
Net income		—		35,539		62,632		79,655

- Definition

Tabular disclosure of information related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component.

+ References

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+ Details

Ampreloxetine Funding (Tables)

9 Months Ended

Sep. 30, 2022

Ampreloxetine Funding.

Schedule of future royalty payment contingencies


(In thousands)
Beginning balance at July 20, 2022	$	—
Consideration allocated, less transaction costs of $0.5 million		24,464
Interest accretion		424
Balance at September 30, 2022	$	24,888

Corporate Restructuring Update (Tables)

9 Months Ended

Sep. 30, 2022

Corporate Restructuring Update

Schedule of information related to accrued restructuring, severance costs and one-time termination


(In thousands)
Balance at December 31, 2021	$	9,550
Net accruals		6,074
Cash paid		(15,624)
Balance at September 30, 2022	$	—

Net Income (Loss) per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Numerator:
Net income from continuing operations	$ (16,023)	$ (55,910)	$ (78,568)	$ (207,256)
Net loss from discontinued operations	932,654	20,602	961,062	39,864
Net income (loss)	$ 916,631	$ (35,308)	$ 882,494	$ (167,392)
Denominator:
Weighted-average ordinary shares outstanding	75,515	73,574	75,678	68,021
Less: weighted-average ordinary shares subject to forfeiture				76
Weighted-average ordinary shares outstanding - basic	75,515	73,574	75,678	67,945
Weighted-average ordinary shares outstanding - diluted	75,515	73,574	75,678	67,945
Continuing operations - basic	$ (0.21)	$ (0.76)	$ (1.04)	$ (3.05)
Continuing operations - diluted	(0.21)	(0.76)	(1.04)	(3.05)
Discontinued operations - basic	12.35	0.28	12.70	0.59
Discontinued operations - diluted	12.35	0.28	12.70	0.59
Net income (loss) - basis	12.14	(0.48)	11.66	(2.46)
Net income (loss) - diluted	$ 12.14	$ (0.48)	$ 11.66	$ (2.46)

Net Income (Loss) per Share - Anti-dilutive Securities (Details) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Anti-Dilutive Securities
Anti-dilutive securities (in shares)	5,036	15,576	7,137	14,983
Share issuances under equity incentive plans and purchase plans
Anti-Dilutive Securities
Anti-dilutive securities (in shares)	5,036	8,900	7,137	8,307
Share issuances upon the conversion of convertible senior notes
Anti-Dilutive Securities
Anti-dilutive securities (in shares)		6,676		6,676

Revenue - Viatris Agreement (Details) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended		9 Months Ended
	Feb. 28, 2018	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Collaborative Arrangements and Co-Promote Agreement
Percentage of profit share				35.00%
Revenues		$ 12,451	$ 13,194	$ 36,697	$ 40,365
Collaboration revenue
Collaborative Arrangements and Co-Promote Agreement
Revenues		6	2,797	187	8,649
Revefenacin Monotherapy (TD-4208)
Collaborative Arrangements and Co-Promote Agreement
Upfront payment receivable				205,000
Revefenacin Monotherapy (TD-4208) \| Success Based Development Regulatory And Sales Milestones
Collaborative Arrangements and Co-Promote Agreement
Upfront payment receivable				17,500
Revefenacin Monotherapy (TD-4208) \| Sales milestones
Collaborative Arrangements and Co-Promote Agreement
Upfront payment receivable				187,500
Future potential combination products
Collaborative Arrangements and Co-Promote Agreement
Upfront payment receivable				52,500
YUPELRI Monotherapy
Collaborative Arrangements and Co-Promote Agreement
Upfront payment receivable				205,000
Collaborative Arrangement
Collaborative Arrangements and Co-Promote Agreement
Revenues		$ 6	2,797	187	8,649
Collaborative Arrangement \| Alfasigma license option
Collaborative Arrangements and Co-Promote Agreement
Revenues			3	$ 169	10
Janssen \| Collaborative Arrangement
Collaborative Arrangements and Co-Promote Agreement
Revenues			2,788		8,621
Janssen \| Development and Commercialization Agreement
Collaborative Arrangements and Co-Promote Agreement
Upfront payment receivable	$ 100,000
Revenue from collaborative arrangements			$ 2,800		$ 8,600
Viatris
Collaborative Arrangements and Co-Promote Agreement
Percentage of profit share				65.00%
Upfront payment receivable				$ 257,500
Viatris \| YUPELRI Monotherapy
Collaborative Arrangements and Co-Promote Agreement
Percentage of profit share		35.00%	35.00%	35.00%	35.00%
Revenues		$ 18,700	$ 13,800	$ 51,200	$ 41,300
Viatris \| Collaborative Arrangement
Collaborative Arrangements and Co-Promote Agreement
Revenues		6	6	18	18
Viatris \| Collaborative Arrangement \| Collaboration revenue
Collaborative Arrangements and Co-Promote Agreement
Revenues		$ 12,445	$ 10,397	$ 34,010	$ 31,716

Revenue - Development and Commercialization Agreement (Details) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended		6 Months Ended	9 Months Ended		12 Months Ended
	Mar. 31, 2022	Sep. 30, 2022	Sep. 30, 2021	Jun. 30, 2022	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2019	Dec. 31, 2015
Collaborative Arrangements and Co-Promote Agreement
Percentage of profit share					35.00%
Milestone payment		$ 12,451	$ 13,194		$ 36,697	$ 40,365
Collaborative Arrangement
Collaborative Arrangements and Co-Promote Agreement
Milestone payment		6	2,797		$ 187	8,649
Viatris
Collaborative Arrangements and Co-Promote Agreement
Percentage of profit share					65.00%
Viatris \| Collaborative Arrangement
Collaborative Arrangements and Co-Promote Agreement
Milestone payment		$ 6	$ 6		$ 18	$ 18
Viatris \| Revefenacin Monotherapy (TD-4208)
Collaborative Arrangements and Co-Promote Agreement
Initial cash payment								$ 15,000
Transaction price								$ 15,000
Pfizer
Collaborative Arrangements and Co-Promote Agreement
Initial cash payment							$ 10,000
Milestone payment	$ 2,500
Pfizer \| Sales milestones
Collaborative Arrangements and Co-Promote Agreement
Initial cash payment				$ 237,500

Revenue - Reimbursement of R and D Costs (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Research and Development Reimbursement
Total reduction to R and D expense	$ 1,657	$ 3,301	$ 4,736	$ 5,987
Viatris
Research and Development Reimbursement
Total reduction to R and D expense	$ 1,657	1,096	$ 4,736	1,257
Janssen
Research and Development Reimbursement
Total reduction to R and D expense		$ 2,205		$ 4,730

Sale of Velusetrag (Details) - Sale of Velusetrag. - Disposed of by Sale - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Jul. 31, 2022	Jun. 30, 2022
Sale of Velusetrag
Consideration from sale of velusetrag assets		$ 2,800
Remaining book value of assets	$ 0
Gain on sale of velusetrag assets	$ 2,700
Maximum
Sale of Velusetrag
Future developmental and sales milestones			$ 105,000

Cash, Cash Equivalents, and Restricted Cash (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021	Sep. 30, 2021	Dec. 31, 2020
Cash, Cash Equivalents, and Restricted Cash
Cash and cash equivalents	$ 418,538	$ 89,959	$ 121,424
Restricted cash	836		833
Total cash, cash equivalents, and restricted cash shown on the condensed consolidated statements of cash flows	419,374	$ 90,796	$ 122,257	$ 82,300
Share repurchase authorized amount	$ 250,000

Investments and Fair Value Measurements - Available-for-sale securities (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Available for sale securities:
Amortized Cost	$ 475,044	$ 133,738
Gross Unrealized Gains		1
Gross Unrealized Losses	(121)	(5)
Estimated Fair Value	474,923	133,734
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Estimated Fair Value lesser than 12 months	77,249	35,017
Estimated Fair Value Total	77,249	35,017
Gross unrealized lesser than 12 months	(121)	(5)
Gross unrealized loss, Total	(121)	(5)
Marketable securities
Available for sale securities:
Amortized Cost	77,370	83,510
Gross Unrealized Gains		1
Gross Unrealized Losses	(121)	(5)
Estimated Fair Value	77,249	83,506
U.S. government securities
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Estimated Fair Value lesser than 12 months	3,979	19,991
Estimated Fair Value Total	3,979	19,991
Gross unrealized lesser than 12 months	(8)	(2)
Gross unrealized loss, Total	(8)	(2)
U.S. government securities \| Quoted Prices in Active Markets for Identical Assets, Level 1
Available for sale securities:
Amortized Cost	3,987	29,986
Gross Unrealized Losses	(8)	(2)
Estimated Fair Value	3,979	29,984
U.S. corporate notes
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Estimated Fair Value lesser than 12 months	11,968	5,031
Estimated Fair Value Total	11,968	5,031
Gross unrealized lesser than 12 months	(38)	(2)
Gross unrealized loss, Total	(38)	(2)
U.S. corporate notes \| Significant Other Observable Inputs, Level 2
Available for sale securities:
Amortized Cost	12,006	5,034
Gross Unrealized Losses	(38)	(2)
Estimated Fair Value	11,968	5,032
U.S. commercial paper
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Estimated Fair Value lesser than 12 months	61,302	9,995
Estimated Fair Value Total	61,302	9,995
Gross unrealized lesser than 12 months	(75)	(1)
Gross unrealized loss, Total	(75)	(1)
U.S. commercial paper \| Significant Other Observable Inputs, Level 2
Available for sale securities:
Amortized Cost	61,377	48,490
Gross Unrealized Gains		1
Gross Unrealized Losses	(75)	(1)
Estimated Fair Value	61,302	48,490
Money market funds \| Quoted Prices in Active Markets for Identical Assets, Level 1
Available for sale securities:
Amortized Cost	397,674	50,228
Estimated Fair Value	$ 397,674	$ 50,228

Investments and Fair Value Measurements - Convertible senior notes (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2022 USD ($)
Maturity period for marketable securities
Maximum contractual maturity period	6 months
Weighted average contractual maturity period	1 month
Fair value transfers
Fair value of assets transferred from Level 1 to Level 2	$ 0
Fair value of assets transferred from Level 2 to Level 1	0
Unrealized losses
Net unrealized losses	$ 0

Leases (Details) $ in Thousands	1 Months Ended			3 Months Ended	9 Months Ended
Leases (Details) $ in Thousands	Jun. 30, 2022 USD ($) ft²	May 31, 2022 USD ($) ft²	Apr. 30, 2017 USD ($) ft²	Sep. 30, 2022 USD ($)	Sep. 30, 2022 USD ($)	Sep. 30, 2021 USD ($)
Lessee, Lease, Description [Line Items]
Decrease in operating lease liabilities					$ 1,111	$ (443)
Sublease
Lessee, Lease, Description [Line Items]
Expects to receive base rent				$ 51,726	51,726
Dublin
Lessee, Lease, Description [Line Items]
Area of leased space \| ft²		700	6,100
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
Annual base rent expenses		$ 200	$ 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
Annual base rent expenses	$ 800
Monthly base rent	$ 500
Increase in annual base rent (as a percent)	3.00%
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	50.00%
Premium component in sublease income to be shared with lessor	$ 6,700
Percentage of excess sublease income over lease obligations to be retained	50.00%
Expected sublease income				$ 1,600	$ 1,900

Leases - Future Undiscounted Cash Inflows Relating to Sublease Agreement (Details) - Sublease $ in Thousands	Sep. 30, 2022 USD ($)
Future Undiscounted Cash Inflows
2022	$ 3,554
2023	6,495
2024	6,495
2025	6,495
2026	6,495
Thereafter	22,192
Total operating sublease receipts	$ 51,726

Sale of Equity Interests in Theravance Respiratory Company, LLC and Discontinued Operations (Details) $ in Thousands		3 Months Ended	9 Months Ended
	Jul. 20, 2022 USD ($) shares	Sep. 30, 2022 USD ($)	Sep. 30, 2022 USD ($)
Theravance Respiratory Company, LLC
Future contingent milestone and royalty assets		$ 194,200	$ 194,200
Royalty Pharma \| Disposed of by Sale \| TRC
Theravance Respiratory Company, LLC
Net gain from sale of equity interests in TRC,LLC	$ 1,141,100	$ 1,141,084	$ 1,141,084
Consideration received	1,301,600
Proceeds from the sale of equity interest in TRC, LLC	1,107,400
Equity method investments	136,700
Future contingent milestone and royalty assets	194,200
Transaction costs	$ 23,800
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
Consideration Receivable at closing	$ 250,000
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
Consideration Receivable at closing	$ 1,326,600

Sale of Equity Interests in Theravance Respiratory Company, LLC and Discontinued Operations - Summary of discontinued operations (Details) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
	Jul. 20, 2022	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Jul. 26, 2022	Feb. 21, 2020
Schedule of Equity Method Investments [Line Items]
Provision for income tax expense		$ (182,362)		$ (182,868)
Total net income from discontinued operations		$ 932,654	$ 20,602	$ 961,062	$ 39,864
2035 notes
Schedule of Equity Method Investments [Line Items]
Interest rate (as a percent)		9.50%	9.50%	9.50%	9.50%		9.50%
2033 notes
Schedule of Equity Method Investments [Line Items]
Interest rate (as a percent)		3.25%		3.25%		3.25%
Disposed of by Sale \| TRC \| Royalty Pharma
Schedule of Equity Method Investments [Line Items]
Income from investment in TRC, LLC			$ 30,208	$ 53,237	$ 68,681
Transaction - related legal expenses (prior to July 20, 2022)				(5,057)
Loss on extinguishment of debt		$ (24,022)		(24,022)
Net gain from sale of equity interests in TRC,LLC	$ 1,141,100	1,141,084		1,141,084
Provision for income tax expense		(182,362)		(182,868)
Total net income from discontinued operations		932,654	20,602	961,062	39,864
Disposed of by Sale \| TRC \| Royalty Pharma \| 2035 notes
Schedule of Equity Method Investments [Line Items]
Interest expense on 9.5% Non-recourse notes due 2035		$ (2,046)	$ (9,606)	$ (21,312)	$ (28,817)

Sale of Equity Interests in Theravance Respiratory Company, LLC and Discontinued Operations - Summary financial information (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Summary financial information
Revenues	$ 12,451	$ 13,194	$ 36,697	$ 40,365
Income from continuing operations	(16,023)	(55,910)	(78,568)	(207,256)
Net income	$ 916,631	(35,308)	882,494	(167,392)
TRC
Summary financial information
Income from continuing operations		35,391	71,693	80,244
Net income		35,539	62,632	79,655
TRC \| Royalties
Summary financial information
Revenues		$ 35,585	$ 72,029	$ 84,055

- Definition

Amount after tax of income (loss) from continuing operations attributable to the parent.

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The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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+ Details

Ampreloxetine Funding (Details) $ in Millions		9 Months Ended
Ampreloxetine Funding (Details) $ in Millions	Jul. 20, 2022 USD ($)	Sep. 30, 2022 USD ($)
Ampreloxetine Royalty Rights
Development and Collaboration Agreement
Consideration Receivable at closing	$ 25.0
Consideration received at the time of first approval	$ 15.0
Patent Application Period	5 years
Milestone payments	$ 15.0
Carrying amount of the liability		$ 25.0
Percent of effective interest rate		8.50%
Ampreloxetine Royalty Rights \| Net Sales Upto First 500 Million
Development and Collaboration Agreement
Consideration received	$ 500.0
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	$ 500.0
Royalty Payment Percentage Multiplied with Net Sales	4.5
Ampreloxetine Funding
Development and Collaboration Agreement
Consideration Receivable at closing	$ 25.0

Ampreloxetine Funding - Schedule of Future Royalty Payment Contingencies (Details) - USD ($) $ in Thousands	2 Months Ended	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2022
Development and Collaboration Agreement
Consideration allocated, less transaction costs of $0.5 million		$ 24,464
Interest accretion		424
Ending balance	$ 24,888	24,888
Ampreloxetine Royalty Rights
Development and Collaboration Agreement
Consideration allocated, less transaction costs of $0.5 million	24,464
Interest accretion	424
Ending balance	$ 24,888	24,888
Transaction costs		$ 500

Extinguishment of Debt (Details) - USD ($) $ in Thousands			3 Months Ended	9 Months Ended
Extinguishment of Debt (Details) - USD ($) $ in Thousands	Jul. 26, 2022	Jul. 20, 2022	Sep. 30, 2022	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021	Feb. 21, 2020
Debt Instrument [Line Items]
Accrued interest						$ 1,246
Loss on extinguishment of debt			$ (3,034)	$ (3,034)
9.5% Non-Recourse 2035 Notes
Debt Instrument [Line Items]
Interest rate (as a percent)			9.50%	9.50%	9.50%		9.50%
Principal amount							$ 400,000
Percentage of note to be sold							95.00%
Percentage of note to be retained							5.00%
Accrued interest		$ 4,700
Early redemption premium fee		20,000
Loss on extinguishment of debt		(24,000)
Transaction costs		200
Net interest shortfall		30,700
Principal payment on notes		$ 400,000		$ 399,998	$ 10,730
3.25% Convertible Senior Notes Due 2023
Debt Instrument [Line Items]
Interest rate (as a percent)	3.25%		3.25%	3.25%
Principal amount	$ 230,000
Accrued interest	2,400
Loss on extinguishment of debt	(3,000)
Retirement of debt	$ 230,000
Debt retired (as percent)	100.00%
Transaction costs	$ 1,600
Principal payment on notes				$ 231,605
TRC
Debt Instrument [Line Items]
Percentage of economic interest				85.00%
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)				10.00%
TRC \| Issuer II Class C Units
Debt Instrument [Line Items]
Percentage of economic interest				63.75%
Issuer II Class C Units
Debt Instrument [Line Items]
Percentage of equity interest			75.00%	75.00%

Share-Based Compensation - Performance Contingent Awards (Details) $ in Thousands	1 Months Ended	3 Months Ended		6 Months Ended	9 Months Ended
	Sep. 30, 2021 USD ($)	Sep. 30, 2022 USD ($)	Sep. 30, 2021 USD ($)	Jun. 30, 2022 employee	Sep. 30, 2022 USD ($) shares	Sep. 30, 2021 USD ($)
Share-Based Compensation
Stock-based compensation expense		$ 8,530	$ 14,370		$ 32,784	$ 45,143
Incremental Share-Based Compensation expense		0			1,700
Cumulative compensation cost	$ 800
Restructuring and related expenses
Share-Based Compensation
Stock-based compensation expense		711			$ 5,587
Incremental Share-Based Compensation expense	$ 2,500
Number of employees reduction in workforce \| employee				45
Performance-Contingent Awards - RSUs
Share-Based Compensation
RSUs outstanding (in shares) \| shares					305,000
Performance-Contingent Awards - RSUs.
Share-Based Compensation
Stock-based compensation expense		$ 400	$ 100		$ 600	$ 700
Maximum potential expense \| Performance-Contingent Awards - RSUs.
Share-Based Compensation
Stock-based compensation expense					$ 2,100

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
Income Taxes (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Sep. 30, 2022	Dec. 31, 2021
Provision for income tax benefit (expense)
Income tax expense	$ 182,362	$ 182,868
Gross increase in tax positions for current year		62,300
Unrecognized Tax Benefits	$ 62,661	62,661	$ 240
Non- recurring tax benefit due to valuation allowance reversal		$ 61,900

- Definition

Amount of tax expense (benefit) related to a discontinued operation. Includes, but is not limited to, tax expense (benefit) related to income (loss) from operations during the phase-out period, tax expense (benefit) related to gain (loss) on disposal, tax expense (benefit) related to gain (loss) for reversal of write-down (write-down) to fair value, less cost to sell, and tax expense (benefit) related to adjustments of a prior period gain (loss) on disposal.

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+ Details

Corporate Restructuring Update (Details) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended		13 Months Ended
	Sep. 15, 2021	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022
Corporate Restructuring
Reduction in workforce (as a percent)	75.00%
Restructuring costs		$ 509	$ 1,771	$ 11,427	$ 1,771	$ 31,600
Research and development
Corporate Restructuring
Restructuring costs		100		5,300		15,800
Selling, general and administrative
Corporate Restructuring
Restructuring costs		400		6,200		15,800
Severance
Corporate Restructuring
Restructuring costs						31,600
Employee-related separation costs		500		11,400
Cash charges related to modification of equity-awards for terminated and remaining employee		200		5,800		17,400
Non-cash charges related to modification of equity-awards for terminated and remaining employee		$ 700		$ 5,600		$ 14,200

Corporate Restructuring Update - Accrued restructuring, severance costs and one-time termination costs (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2022 USD ($)
Restructuring Reserve [Roll Forward]
Balance at December 31, 2021	$ 9,550
Net accruals	6,074
Cash paid	$ (15,624)

Capital Return Program (Details) - USD ($)				9 Months Ended
Capital Return Program (Details) - USD ($)	Sep. 28, 2022	Sep. 27, 2022	Sep. 20, 2022	Sep. 30, 2022	Dec. 31, 2021
Capital Return Program
Share repurchase authorized amount				$ 250,000,000.0
Ordinary shares, par value (in dollars per share)				$ 0.00001	$ 0.00001
Consideration for repurchase				$ 94,037,000
Ordinary shares, shares issued				67,366,000	74,435,000
Ordinary shares, shares outstanding				67,366,000	74,435,000
GSK Share Repurchase
Capital Return Program
Share repurchase authorized amount				$ 250,000,000.0
Shares authorized to be repurchased (in shares)			9,644,807
Ordinary shares, par value (in dollars per share)			$ 0.00001
Repurchase price (in dollars per share)			$ 9.75
Consideration for repurchase			$ 94,000,000.0
Ordinary shares, shares issued			0
Ordinary shares, shares outstanding			0
Number of shares to be repurchased			9,644,807
Modified Dutch Auction Tender Offer
Capital Return Program
Share repurchase authorized amount	$ 95,000,000.0
Ordinary shares, shares outstanding		67,365,912
Modified Dutch Auction Tender Offer \| Share repurchase at $10.50
Capital Return Program
Repurchase price (in dollars per share)		$ 10.50
Consideration for repurchase		$ 9,047,619
Share repurchase (as a percent)		13.40%
Modified Dutch Auction Tender Offer \| Share repurchase at $9.75
Capital Return Program
Repurchase price (in dollars per share)		$ 9.75
Number of shares to be repurchased		9,743,589
Share repurchase (as a percent)		14.50%
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
Open Market Share Repurchase Plan
Capital Return Program
Share repurchase authorized amount				$ 60,000,000.0
Repurchase of ordinary shares (in shares)				0