0001558370-24-008201 | 10-Q | XBRL Viewer

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Mar. 31, 2024	Mar. 31, 2023
Pay vs Performance Disclosure
Net Income (Loss)	$ (11,664)	$ (22,088)

- Definition

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

+ References

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+ Details

Investments and Fair Value Measurements - Contingent Consideration Asset (Details) $ in Millions	Mar. 31, 2024 USD ($)	Jul. 31, 2022
Theravance Respiratory Company, LLC
Contingent Consideration carrying value	$ 194.2
Royalty Pharma \| Disposed of by Sale \| TRC \| Measurement Input, Discount Rate [Member]
Theravance Respiratory Company, LLC
Equity method investment, contingent consideration		7.83

Investments and Fair Value Measurements - Available-for-sale securities (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Available for sale securities:
Amortized Cost	$ 75,380	$ 89,125
Gross Unrealized Gains		4
Gross Unrealized Losses	(41)	(69)
Estimated Fair Value	75,339	89,060
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Estimated Fair Value lesser than 12 months	49,271	57,880
Fair value of assets transferred from Level 1 to Level 2	0
Fair value of assets transferred from Level 2 to Level 1	0
Estimated Fair Value Total	49,271	57,880
Gross unrealized lesser than 12 months	(41)	(69)
Gross unrealized loss, Total	(41)	(69)
Marketable securities
Available for sale securities:
Amortized Cost	61,109	62,946
Gross Unrealized Gains		4
Gross Unrealized Losses	(41)	(69)
Estimated Fair Value	61,068	62,881
U.S. government securities
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Estimated Fair Value lesser than 12 months	10,431	29,819
Estimated Fair Value Total	10,431	29,819
Gross unrealized lesser than 12 months	(3)	(29)
Gross unrealized loss, Total	(3)	(29)
U.S. government securities \| Quoted Prices in Active Markets for Identical Assets, Level 1
Available for sale securities:
Amortized Cost	22,231	29,848
Gross Unrealized Losses	(3)	(29)
Estimated Fair Value	22,228	29,819
U.S. corporate notes
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Estimated Fair Value lesser than 12 months	11,195	23,641
Estimated Fair Value Total	11,195	23,641
Gross unrealized lesser than 12 months	(16)	(32)
Gross unrealized loss, Total	(16)	(32)
U.S. corporate notes \| Significant Other Observable Inputs, Level 2
Available for sale securities:
Amortized Cost	11,211	28,670
Gross Unrealized Gains		4
Gross Unrealized Losses	(16)	(32)
Estimated Fair Value	11,195	28,642
U.S. commercial paper
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Estimated Fair Value lesser than 12 months	24,680
Estimated Fair Value Total	24,680
Gross unrealized lesser than 12 months	(19)
Gross unrealized loss, Total	(19)
U.S. commercial paper \| Significant Other Observable Inputs, Level 2
Available for sale securities:
Amortized Cost	24,698
Gross Unrealized Losses	(19)
Estimated Fair Value	24,679
U.S. government agency securities
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract]
Estimated Fair Value lesser than 12 months	2,965	4,420
Estimated Fair Value Total	2,965	4,420
Gross unrealized lesser than 12 months	(3)	(8)
Gross unrealized loss, Total	(3)	(8)
U.S. government agency securities \| Significant Other Observable Inputs, Level 2
Available for sale securities:
Amortized Cost	2,969	4,428
Gross Unrealized Losses	(3)	(8)
Estimated Fair Value	2,966	4,420
Money market funds \| Quoted Prices in Active Markets for Identical Assets, Level 1
Available for sale securities:
Amortized Cost	14,271	26,179
Estimated Fair Value	$ 14,271	$ 26,179

Organization and Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2024

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 development and commercialization of medicines. The Company’s focus is to deliver medicines that make a difference^® in people's lives.

Basis of Presentation

The Company’s condensed consolidated financial statements as of March 31, 2024 and for the three months ended March 31, 2024 and 2023 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, 2023 financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission (“SEC”) on March 1, 2024.

The results for the three months ended March 31, 2024 are not necessarily indicative of the results to be expected for the year ending December 31, 2024, 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.

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. Due to the inherent uncertainty in making estimates, actual results could differ materially from those estimates.

The Company expects its cash, cash equivalents and marketable securities will be sufficient to fund its operations for at least the next twelve months from the issuance date of these condensed consolidated financial statements based on current operating plans and financial forecasts.

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, 2023.

Recently Issued Accounting Pronouncements Not Yet Adopted

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”). ASU 2023-09 requires entities to provide additional information in their tax rate reconciliation and additional disclosures about income taxes paid by jurisdiction. ASU 2023-09 is effective on a prospective basis for annual periods beginning after December 15, 2024. Early adoption is also permitted for annual financial statements that have not yet been issued or made available for issuance. The Company is evaluating the impact of adopting ASU 2023-09 on its consolidated financial statements income tax disclosures.

The Company has evaluated other recently issued accounting pronouncements and does not currently believe that any of these pronouncements will have a material impact on its consolidated financial statements and related disclosures.

Net Loss per Share and Anti-dilutive Securities

3 Months Ended

Mar. 31, 2024

Net Loss per Share and Anti-dilutive Securities

Net Loss per Share and Anti-dilutive Securities

2. Net Loss per Share and Anti-dilutive Securities

Basic net loss per share is computed by dividing net loss by the weighted-average number of shares outstanding during the period. Diluted net loss per share is computed by increasing the weighted-average number of shares outstanding for the dilutive effect of potential ordinary shares determined using the treasury stock method. Potential ordinary shares include outstanding share options, ordinary shares expected to be issued under the Company’s employee share purchase plan (“ESPP”), restricted share units (“RSUs”), and performance-contingent RSUs for which the performance or market vesting conditions have been deemed probable. Performance-contingent RSUs with performance or market vesting conditions that have been deemed not probable as of the end of the period are not included in the diluted net loss per share computation.


	Three Months Ended March 31,
(In thousands, except per share data)	2024		2023
Numerator:
Net loss	$	(11,664)	$	(22,088)

Denominator:
Weighted-average ordinary shares outstanding		48,283		62,934
Less: weighted-average ordinary shares subject to forfeiture		—		—
Weighted-average ordinary shares outstanding - basic and diluted		48,283		62,934

Net loss per share - basic and diluted	$	(0.24)	$	(0.35)

In accordance with Accounting Standards Codification (“ASC”) 260, Earnings Per Share, if a company incurred a net loss, then potential ordinary shares are considered anti-dilutive for the periods in which the net loss was recognized. As a result, the following potential ordinary shares were not included in the computation of diluted net loss per share because including them would have had an anti-dilutive effect:


	Three Months Ended March 31,
(In thousands)	2024	2023
Options	2,304	2,467
Restricted share units and performance-contingent RSUs deemed probable	848	1,775
Employee share purchase plan	109	47
Total	3,261	4,289

Revenue - Viatris Agreement (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Collaborative Arrangements and Co-Promote Agreement
Percentage of profit share	35.00%
Maximum potential payments receivable	$ 205,000
Izencitinib \| Sales milestones
Collaborative Arrangements and Co-Promote Agreement
Maximum potential payments receivable	150,000
Revefenacin Monotherapy (TD-4208)
Collaborative Arrangements and Co-Promote Agreement
Maximum potential payments receivable	160,000
Future potential combination products
Collaborative Arrangements and Co-Promote Agreement
Maximum potential payments receivable	45,000
YUPELRI Monotherapy
Collaborative Arrangements and Co-Promote Agreement
Maximum potential payments receivable	160,000
YUPELRI Monotherapy \| Success Based Development Regulatory And Sales Milestones
Collaborative Arrangements and Co-Promote Agreement
Maximum potential payments receivable	10,000
Development and Commercialization Agreement \| Future potential combination products
Collaborative Arrangements and Co-Promote Agreement
Maximum potential payments receivable	7,500
Development and Commercialization Agreement \| YUPELRI Monotherapy \| Success Based Development Regulatory And Sales Milestones
Collaborative Arrangements and Co-Promote Agreement
Maximum potential payments receivable	7,500
Development and Commercialization Agreement \| YUPELRI Monotherapy \| Sales milestones
Collaborative Arrangements and Co-Promote Agreement
Maximum potential payments receivable	$ 37,500
Viatris
Collaborative Arrangements and Co-Promote Agreement
Percentage of profit share	65.00%
Upfront payment receivable	$ 52,500
Maximum potential payments receivable	45,000
Viatris \| Collaboration revenue
Collaborative Arrangements and Co-Promote Agreement
Revenues	$ 14,503	$ 10,411
Viatris \| YUPELRI Monotherapy
Collaborative Arrangements and Co-Promote Agreement
Percentage of profit share	35.00%
Revenues	$ 19,329	$ 16,434
Maximum potential payments receivable	$ 45,000

Subleases

3 Months Ended

Mar. 31, 2024

Subleases

Subleases

6. Subleases

In March 2024, the Company entered into a non-cancelable agreement under which it subleased approximately 8,000 square feet of its South San Francisco office space to an unaffiliated company. The sublease term is for approximately two years expiring in April 2026, 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 $38,000 with a 3% increase after the first year. The Company will recognize approximately $0.9 million in total sublease income on a straight-line basis over the two-year sublease term. Sublease income is recognized as a reduction to the Company’s facilities expense which is then allocated to selling, general and administrative expenses and R&D expenses in the condensed consolidated statements of operations.

As of March 31, 2024, the Company has subleased approximately 107,000 square feet of a total 162,000 square feet of South San Francisco office and laboratory space under three separate subleases with unaffiliated companies. The Company’s sublease income from all three subleases is summarized below:


	Three Months Ended March 31,
(In thousands)	2024		2023
Sublease income	$	2,090	$	2,090

As of March 31, 2024, the Company has approximately 31,000 square feet of remaining vacant office and laboratory space in South San Francisco on the market for sublease. The Company evaluates the carrying value of its long-lived asset groups, which includes right-of-use assets, for impairment when indicators exist that the carrying amounts of the asset may not be fully recoverable. An impairment loss is recognized when estimated undiscounted future cash flows expected to result from the use of the asset or asset group are less than its carrying amount. Impairment, if any, is measured as the amount by which the carrying amount of a long-lived asset exceeds its fair value.

The Company determined that its vacant office and laboratory space currently marketed for sublease was an indicator of impairment. Based on the Company’s impairment assessment as of March 31, 2024, the Company determined that the estimated undiscounted future cash flows of its identified asset groups exceeded the carrying value of such asset groups, and as a result, the Company did not recognize an impairment charge for the three months ended

March 31, 2024. The Company will continue to update its long-lived asset impairment assessment each quarterly period, and the Company may record a non-cash impairment charge in future periods as its estimates change.

Investments and Fair Value Measurements - Ampreloxetine Funding (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2024	Jul. 31, 2022
Ampreloxetine Royalty Rights
Development and Collaboration Agreement
Milestone payments		$ 15.0
Carrying amount of the liability		25.0
Percent of effective interest rate	8.80%
Ampreloxetine Funding
Development and Collaboration Agreement
Consideration Receivable at closing		$ 25.0

Completion of Capital Return Program

3 Months Ended

Mar. 31, 2024

Completion of Capital Return Program

Completion of Capital Return Program

7. Completion of Capital Return Program

In January 2024, the Company repurchased an additional 38,462 of its shares on the open market at a weighted average cost of $11.551 per share for an approximate aggregate cost of $0.4 million, excluding fees and expenses, to complete its capital return program. Since the initiation of the capital return program in September 2022 through January 2024, the Company repurchased a total of 31.412 million of its shares at a weighted average price of $10.3544 per share for an approximate aggregate cost of $325.3 million, excluding fees and expenses.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands	Ordinary Shares	Additional Paid-In Capital	Accumulated Other Comprehensive Gain (Loss)	Accumulated Deficit	Total
Balances at Dec. 31, 2022	$ 1	$ 1,295,725	$ (15)	$ (853,911)	$ 441,800
Balances (in shares) at Dec. 31, 2022	65,227
Increase (Decrease) in Stockholders' Equity
Repurchase of ordinary shares, net of transaction costs		(55,353)			(55,353)
Repurchase of ordinary shares, net of transaction costs (in shares)	(5,158)
Employee share-based compensation expense		7,021			7,021
Issuance of restricted shares (in shares)	557
Repurchase of shares to satisfy tax withholding		(887)			(887)
Repurchase of shares to satisfy tax withholding (in shares)	(84)
Net unrealized gain on marketable securities			66		66
Net Income (Loss)				(22,088)	(22,088)
Balances at Mar. 31, 2023	$ 1	1,246,506	51	(875,999)	370,559
Balances (in shares) at Mar. 31, 2023	60,542
Balances at Dec. 31, 2023		1,122,164	(65)	(909,104)	$ 212,995
Balances (in shares) at Dec. 31, 2023	48,091				48,091
Increase (Decrease) in Stockholders' Equity
Repurchase of ordinary shares, net of transaction costs		(445)			$ (445)
Repurchase of ordinary shares, net of transaction costs (in shares)	(38)
Employee share-based compensation expense		5,229			5,229
Issuance of restricted shares (in shares)	658
Repurchase of shares to satisfy tax withholding		(1,271)			(1,271)
Repurchase of shares to satisfy tax withholding (in shares)	(145)
Net unrealized gain on marketable securities			24		24
Net Income (Loss)				(11,664)	(11,664)
Balances at Mar. 31, 2024		$ 1,125,677	$ (41)	$ (920,768)	$ 204,868
Balances (in shares) at Mar. 31, 2024	48,566				48,566

Restructuring and Related Expenses

3 Months Ended

Mar. 31, 2024

2021 Corporate Restructuring Completion and 2023 Strategic Actions

Restructuring and Related Expenses

8. Restructuring and Related Expenses

In February 2023, the Company announced strategic actions (the “2023 Strategic Actions”) that included the discontinuation of its research activities, resulting in a 17% reduction in headcount in March 2023. As a result of the Company’s discontinued investment in research activities, the Company incurred restructuring and related expenses of $1.6 million primarily related to R&D expenses. Of the total $1.6 million, cash-related expenses were $1.2 million and non-cash expenses were $0.4 million which were primarily related to the modification of equity-based awards for employees affected by the reduction in headcount.

Completion of Capital Return Program (Details) - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended	3 Months Ended		17 Months Ended
	Jan. 31, 2024	Mar. 31, 2024	Mar. 31, 2023	Jan. 31, 2024
Completion of Capital Return Program
Shares repurchased	38,462			31,412,000
Weighted average cost per share (excluding fees and expenses)	$ 11.551			$ 10.3544
Amount (excluding fees and expenses)	$ 400	$ 445	$ 55,353	$ 325,300

- Definition

Number of shares that have been repurchased during the period and have not been retired and are not held in treasury. Some state laws may govern the circumstances under which an entity may acquire its own stock and prescribe the accounting treatment therefore. This element is used when state law does not recognize treasury stock.

+ References + Details

- Definition

Equity impact of the value of stock that has been repurchased during the period and has not been retired and is not held in treasury. Some state laws may mandate the circumstances under which an entity may acquire its own stock and prescribe the accounting treatment therefore. This element is used when state law does not recognize treasury stock.

+ References + Details

Revenue

3 Months Ended

Mar. 31, 2024

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 the Company). Outside the US (excluding China and adjacent territories), Viatris is responsible for development and commercialization and will pay the Company a tiered royalty on net sales at percentage royalty rates ranging from low double-digits to mid-teens. Viatris also holds exclusive development and commercialization rights to nebulized revefenacin in China and adjacent territories, which include the Hong Kong SAR, the Macau SAR, and Taiwan, and the Company is eligible to receive low double-digit tiered royalties on net sales of nebulized revefenacin in this region, if approved. Viatris is responsible for all aspects of development and commercialization in the China and adjacent territories, including pre- and post-launch activities and

product registration and all associated costs. 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 March 31, 2024, the Company is eligible to receive from Viatris potential global development, regulatory and sales milestone payments (excluding China and adjacent territories) up to $205.0 million in the aggregate, with $160.0 million associated with YUPELRI monotherapy and $45.0 million associated with future potential combination products. Of the $160.0 million associated with monotherapy, $150.0 million relates to sales milestones based on achieving certain levels of US net sales and $10.0 million relates to regulatory actions in the European Union (“EU”). The Company is also eligible to receive additional potential development and sales milestones up to $52.5 million related to Viatris’ development and commercialization of nebulized revefenacin in China and adjacent territories with $45.0 million associated with YUPELRI monotherapy and $7.5 million associated with future potential combination products. Of the $45.0 million associated with monotherapy, $37.5 million relates to sales milestones based on achieving certain levels of net sales and $7.5 million relates to regulatory approval in China.

The Viatris Agreement is considered to be within the scope of ASC 808, Collaborative Arrangements, 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, 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, Revenue Recognition, and, as such, the reimbursable program costs are excluded from the original transaction price.

The future potential milestone amounts for the Viatris Agreement were not included in the original 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 months ended March 31, 2024, 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 March 31,
(In thousands)	2024		2023
Viatris collaboration agreement – Amounts receivable from Viatris	$	14,503	$	10,411

While Viatris records total YUPELRI net sales within its own consolidated financial statements, Viatris collaboration agreement revenue on the Company’s condensed consolidated statements of operations included the Company’s implied 35% share of total YUPELRI net sales, before deducting shared expenses, as presented below:


	Three Months Ended March 31,
(In thousands)	2024		2023
YUPELRI net sales (Theravance Biopharma implied 35%)	$	19,329	$	16,434

Reimbursement of R&D Expenses

As noted above, under certain collaborative arrangements the Company is entitled to reimbursement of certain R&D expenses. Activities under collaborative arrangements for which the Company is entitled to reimbursement are considered to be collaborative activities under the scope of ASC 808. For these units of account, the Company does not analogize to ASC 606 or recognize revenue. The Company records reimbursement payments received from its

collaboration partners as reductions to R&D expense.

The following table summarizes the reductions to R&D expenses related to reimbursement payments:


	Three Months Ended March 31,
(In thousands)	2024		2023
Viatris	$	189	$	1,753

- 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
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 9
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-9

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
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-Name Accounting Standards Codification
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-Paragraph 10
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-10

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
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-Name Accounting Standards Codification
-Section 50
-Paragraph 15
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-15

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-12

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-12

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
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-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (c)
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-URI https://asc.fasb.org//1943274/2147479806/606-10-50-12

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
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-URI https://asc.fasb.org//1943274/2147479806/606-10-50-12

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
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-URI https://asc.fasb.org//1943274/2147479806/606-10-50-12

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
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-Paragraph 13
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-URI https://asc.fasb.org//1943274/2147479806/606-10-50-13

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Name Accounting Standards Codification
-Topic 606
-Publisher FASB
-URI https://asc.fasb.org//606/tableOfContent

+ Details

Insider Trading Arrangements - Rhonda F Farnum [Member]

3 Months Ended

Mar. 31, 2024

Trading Arrangements, by Individual

Material Terms of Trading Arrangement


				Rule 10b5-1
			Duration of Trading	Trading Arrangement?	Number of Ordinary
Name and Title	Action	Date	Arrangement	(Y / N) ⁽¹⁾	Shares to be Sold
Rhonda F. Farnum, Chief Business Officer and Senior Vice President, Commercial & Medical Affairs	Adoption	March 14, 2024	June 24, 2024 - July 30, 2025	Y	Up to 90,000

(1)	Denotes whether the trading plan is intended to satisfy the affirmative defense Rule 10b5-1(c) of the Exchange Act.

Name

Rhonda F. Farnum

Title

Chief Business Officer and Senior Vice President, Commercial & Medical Affairs

Rule 10b5-1 Arrangement Adopted

true

Adoption Date

March 14, 2024

Aggregate Available

90,000

Net Loss per Share and Anti-dilutive Securities (Details) - shares shares in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Anti-Dilutive Securities
Anti-dilutive securities (in shares)	3,261	4,289
Employee Stock Option
Anti-Dilutive Securities
Anti-dilutive securities (in shares)	2,304	2,467
Restricted share units and Performance-contingent RSUs Deemed Probable
Anti-Dilutive Securities
Anti-dilutive securities (in shares)	848	1,775
Employee share purchase plan
Anti-Dilutive Securities
Anti-dilutive securities (in shares)	109	47

Investments and Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2024

Investments and Fair Value Measurements

Schedule of available-for-sale securities


		March 31, 2024
				Gross		Gross
		Amortized		Unrealized		Unrealized		Estimated
(In thousands)		Cost		Gains		Losses		Fair Value
US government securities	Level 1	$	22,231	$	—	$	(3)	$	22,228
US government agency securities	Level 2		2,969		—		(3)		2,966
Corporate notes	Level 2		11,211		—		(16)		11,195
Commercial paper	Level 2		24,698		—		(19)		24,679
Marketable securities			61,109		—		(41)		61,068
Money market funds	Level 1		14,271		—		—		14,271
Total		$	75,380	$	—	$	(41)	$	75,339


		December 31, 2023
				Gross		Gross
		Amortized		Unrealized		Unrealized		Estimated
(In thousands)		Cost		Gains		Losses		Fair Value
US government securities	Level 1	$	29,848	$	—	$	(29)	$	29,819
US government agency securities	Level 2		4,428		—		(8)		4,420
Corporate notes	Level 2		28,670		4		(32)		28,642
Marketable securities			62,946		4		(69)		62,881
Money market funds	Level 1		26,179		—		—		26,179
Total		$	89,125	$	4	$	(69)	$	89,060

Schedule of Available for sale debt securities with unrealized losses


	March 31, 2024
	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	$	10,431	$	(3)	$	—	$	—	$	10,431	$	(3)
US government agency securities		2,965		(3)		—		—		2,965		(3)
Corporate notes		11,195		(16)		—		—		11,195		(16)
Commercial paper		24,680		(19)		—		—		24,680		(19)
Total	$	49,271	$	(41)	$	—	$	—	$	49,271	$	(41)


	December 31, 2023
	Less than 12 Months				Greater than 12 Months				Total
			Gross				Gross				Gross
	Estimated		Unrealized		Estimated		Unrealized		Estimated		Unrealized
(In thousands)	Fair Value		Losses		Fair Value		Losses		Fair Value		Losses
US government securities	$	29,819	$	(29)	$	—	$	—	$	29,819	$	(29)
US government agency securities		4,420		(8)		—		—		4,420		(8)
Corporate notes		23,641		(32)		—		—		23,641		(32)
Total	$	57,880	$	(69)	$	—	$	—	$	57,880	$	(69)

Schedule of Changes to the Contingent liability


(In thousands)
Balance at December 31, 2023	$	27,788
Non-cash interest expense accretion		629
Balance at March 31, 2024	$	28,417

- Definition

Tabular disclosure of investment in debt security measured at fair value with change in fair value recognized in other comprehensive income (available-for-sale).

+ References

Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 9
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-9

Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-3

Reference 3: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-2

Reference 4: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-2

Reference 5: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-2

Reference 6: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (aa)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-2

Reference 7: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-2

Reference 8: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-2

Reference 9: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
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-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-3

Reference 10: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
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-Section 50
-Paragraph 3
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-3

Reference 11: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-3

Reference 12: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-3

+ Details

Subleases (Details) - South San Francisco	1 Months Ended	3 Months Ended
Subleases (Details) - South San Francisco	Mar. 31, 2024 USD ($) ft² item	Mar. 31, 2024 USD ($) ft² item	Mar. 31, 2023 USD ($)
Office and Laboratory Space, South San Francisco
Lessee, Lease, Description [Line Items]
Area of subleased property	107,000	107,000
Operating sublease income \| $		$ 2,090,000	$ 2,090,000
Total Area	162,000	162,000
Number of separate Subleases entered \| item	3	3
Remaining vacant space for sublease	31,000	31,000
Sublease
Lessee, Lease, Description [Line Items]
Area of subleased property	8,000	8,000
Sublease term	2 years
Option to extend	false
Monthly base rent \| $	$ 38,000
Expected sublease income \| $	$ 900,000
Increase in annual base rent (as a percent)	3.00%

Investments and Fair Value Measurements

3 Months Ended

Mar. 31, 2024

Investments and Fair Value Measurements

Investments and Fair Value Measurements

5. 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:


		March 31, 2024
				Gross		Gross
		Amortized		Unrealized		Unrealized		Estimated
(In thousands)		Cost		Gains		Losses		Fair Value
US government securities	Level 1	$	22,231	$	—	$	(3)	$	22,228
US government agency securities	Level 2		2,969		—		(3)		2,966
Corporate notes	Level 2		11,211		—		(16)		11,195
Commercial paper	Level 2		24,698		—		(19)		24,679
Marketable securities			61,109		—		(41)		61,068
Money market funds	Level 1		14,271		—		—		14,271
Total		$	75,380	$	—	$	(41)	$	75,339


		December 31, 2023
				Gross		Gross
		Amortized		Unrealized		Unrealized		Estimated
(In thousands)		Cost		Gains		Losses		Fair Value
US government securities	Level 1	$	29,848	$	—	$	(29)	$	29,819
US government agency securities	Level 2		4,428		—		(8)		4,420
Corporate notes	Level 2		28,670		4		(32)		28,642
Marketable securities			62,946		4		(69)		62,881
Money market funds	Level 1		26,179		—		—		26,179
Total		$	89,125	$	4	$	(69)	$	89,060

As of March 31, 2024, all of the Company’s available-for-sale securities had contractual maturities within six months, and the weighted-average maturity of marketable securities was approximately two months. There were no transfers between Level 1 and Level 2 during the periods presented, and there have been no material changes to the Company’s valuation techniques during the three months ended March 31, 2024.

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


	March 31, 2024
	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	$	10,431	$	(3)	$	—	$	—	$	10,431	$	(3)
US government agency securities		2,965		(3)		—		—		2,965		(3)
Corporate notes		11,195		(16)		—		—		11,195		(16)
Commercial paper		24,680		(19)		—		—		24,680		(19)
Total	$	49,271	$	(41)	$	—	$	—	$	49,271	$	(41)


	December 31, 2023
	Less than 12 Months				Greater than 12 Months				Total
			Gross				Gross				Gross
	Estimated		Unrealized		Estimated		Unrealized		Estimated		Unrealized
(In thousands)	Fair Value		Losses		Fair Value		Losses		Fair Value		Losses
US government securities	$	29,819	$	(29)	$	—	$	—	$	29,819	$	(29)
US government agency securities		4,420		(8)		—		—		4,420		(8)
Corporate notes		23,641		(32)		—		—		23,641		(32)
Total	$	57,880	$	(69)	$	—	$	—	$	57,880	$	(69)

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 March 31, 2024, and there were no individual securities that were in a significant unrealized loss position as of March 31, 2024.

For the three months ended March 31, 2024, the Company did not sell any marketable securities. For the three months ended March 31, 2023, the Company sold marketable securities for total proceeds of $62.9 million and recognized a net realized gain from the sale of $0.2 million based on the specific identification method.

Contingent Consideration Asset

The Company recognizes a contingent consideration asset related to its sale of its equity interests in Theravance Respiratory Company, LLC (“TRC”) to Royalty Pharma Investments 2019 ICAV, an Irish collective asset-management vehicle (“Royalty Pharma”), in July 2022. The contingent consideration asset represents the fair value of potential future milestone payments and royalties (collectively, “Contingent Consideration”) related to worldwide net sales of GSK plc's (“GSK”) TRELEGY^® ELLIPTA (“TRELEGY”). The Contingent Consideration was initially measured at fair value utilizing a Monte Carlo simulation model to calculate the present value of the risk-adjusted cash flows estimated to be received from the Contingent Consideration. The discount rate utilized in the valuation model was 7.83%.

The fair value model involved significant unobservable inputs derived using management’s estimates. Management’s estimates were based in part on external data and reflected management’s judgements and forecasts. The primary significant unobservable input was the estimate of forecasted TRELEGY net sales which is considered a Level 3 fair value input. The Company reassesses the carrying value of the Contingent Consideration when indicators of impairment are identified and will recognize any increases in the carrying value of the asset when such contingent gains are realized. As of March 31, 2024, the Contingent Consideration had a carrying value of $194.2 million and is presented on the condensed consolidated balance sheets as future contingent milestone and royalty assets. There have been no changes to the carrying value of the Contingent Consideration since its initial measurement date in July 2022.

The Contingent Consideration is subject to counterparty credit risk, and the carrying value of the Contingent Consideration represents the maximum amount of potential loss due to credit risk. To date, the Company has not recorded any credit losses related to the Contingent Consideration.

Ampreloxetine Funding

The Company recognizes a contingent liability related to funding received from Royalty Pharma in exchange for certain future royalty rights to ampreloxetine. The contingent liability consists of an upfront $25.0 million received in July 2022 and management’s estimate of (i) a risk-adjusted future contingent $15.0 million milestone; and (ii) the amount and timing of royalties to be paid to Royalty Pharma and then discounted over the life of the arrangement using an imputed rate of interest. The excess of future estimated royalty payments over the amount of cash funding received is recognized as interest expense using the effective interest method. The balance associated with the contingent liability was initially recorded as $25.0 million, net of allocated transaction costs, in July 2022 and is reported on the condensed consolidated balance sheets as future royalty payment contingency.

The Company periodically reassesses the amount and timing of estimated royalty payments. To the extent such payments are materially greater or less than the Company’s previous estimates, the Company will prospectively adjust the amortization of the contingent liability and the effective interest rate. The imputed effective rate of interest on the unamortized portion of the contingent liability was approximately 8.8% as of March 31, 2024.

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. Such factors include, but are not limited to, changes in the projected market size, the introduction of competing products, patent protection matters, and regulatory product approval for ampreloxetine. The contingent 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, and the expected term of the royalty stream, 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 contingent liability. If ampreloxetine regulatory approval is not achieved or if ampreloxetine sales are never recognized, the contingent liability recognized would be extinguished as the Company would not be obligated to repay any of the funding amounts received from Royalty Pharma.

Changes to the contingent liability were as follows for the three months ended March 31, 2024:


(In thousands)
Balance at December 31, 2023	$	27,788
Non-cash interest expense accretion		629
Balance at March 31, 2024	$	28,417

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($)
shares in Thousands, $ in Thousands

3 Months Ended

Mar. 31, 2024

Mar. 31, 2023

Revenue:

Total revenue

$ 14,503

$ 10,417

Expenses:

Research and development

^[1]

8,968

14,572

Selling, general and administrative

^[1]

16,742

19,183

Restructuring and related expenses

^[1]

1,574

Total expenses

25,710

35,329

Loss from operations

(11,207)

(24,912)

Interest expense (non-cash)

(629)

(550)

Interest income and other income (expense), net

1,434

2,979

Loss before income taxes

(10,402)

(22,483)

Provision for income tax expense (benefit)

1,262

(395)

Net loss

(11,664)

(22,088)

Other comprehensive loss:

Net unrealized gain on available-for-sale investments

Total comprehensive loss

$ (11,640)

$ (22,022)

Net loss per share:

Net loss - basic (in dollars per share)

$ (0.24)

$ (0.35)

Net loss - diluted (in dollars per share)

$ (0.24)

$ (0.35)

Shares used to compute net income (loss) per share - basic

48,283

62,934

Shares used to compute net income (loss) per share - diluted

48,283

62,934

Viatris collaboration agreement

Revenue:

Total revenue

$ 14,503

$ 10,411

Collaboration revenue

Revenue:

Total revenue

$ 6

[1]	Amounts include share-based compensation expense as follows:

Net Loss per Share and Anti-dilutive Securities (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Numerator:
Net Income (Loss)	$ (11,664)	$ (22,088)
Denominator:
Weighted-average ordinary shares outstanding	48,283	62,934
Weighted-average ordinary shares outstanding - basic	48,283	62,934
Weighted-average ordinary shares outstanding - diluted	48,283	62,934
Net income (loss) per share - basic (in dollars per share)	$ (0.24)	$ (0.35)
Net income (loss) per share - diluted (in dollars per share)	$ (0.24)	$ (0.35)

- Definition

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

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The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.

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+ Details

- Definition

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

+ References

+ Details

Cash, Cash Equivalents, and Restricted Cash (Tables)

3 Months Ended

Mar. 31, 2024

Cash, Cash Equivalents, and Restricted Cash

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


	March 31,
(In thousands)	2024		2023
Cash and cash equivalents	$	53,835	$	187,665
Restricted cash		836		836
Total cash, cash equivalents, and restricted cash shown on the condensed consolidated statements of cash flows	$	54,671	$	188,501

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended
Income Taxes (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Mar. 31, 2023
Provision for income tax (expense) benefit
Income tax expense	$ 1,262	$ (395)
Provision for income taxes on undistributed earnings of foreign subsidiaries	$ 0

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

Cash, Cash Equivalents, and Restricted Cash

3 Months Ended

Mar. 31, 2024

Cash, Cash Equivalents, and Restricted Cash

Cash, Cash Equivalents, and Restricted Cash

4. Cash, Cash Equivalents, and Restricted Cash

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the current period and comparable prior year period condensed consolidated balance sheets that sum to the total of the same such amounts shown on the condensed consolidated statements of cash flows.


	March 31,
(In thousands)	2024		2023
Cash and cash equivalents	$	53,835	$	187,665
Restricted cash		836		836
Total cash, cash equivalents, and restricted cash shown on the condensed consolidated statements of cash flows	$	54,671	$	188,501

The Company maintains restricted cash for certain lease agreements and letters of credit by which the Company has pledged cash and cash equivalents as collateral. The cash-related amounts reported in the table above exclude the Company’s investments in short and long-term marketable securities that are reported separately on the condensed consolidated balance sheets.

The decrease in cash, and cash equivalents, and restricted cash compared to the prior year period, was primarily due to the Company’s open market share repurchase program that commenced in December 2022 and was completed in January 2024 (see “Note 7. Completion of Capital Return Program” for more information).

The Company periodically engages in foreign exchange transactions as a part of its operations. The Company recognized net realized and unrealized foreign currency gains (losses) of ($0.1) million and $0.1 million for the three months ended March 31, 2024 and 2023, respectively. These amounts are included in the Company’s condensed consolidated statements of operations within “Interest income and other income (expense), net”.

Investments and Fair Value Measurements - Sales (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Maturity period for marketable securities
Maximum contractual maturity period	6 months
Weighted average contractual maturity period	2 months
Unrealized losses
Net unrealized losses	$ 0
Available-for-sale securities sold		$ 62,900
Realized gains (losses)		$ (200)

Net Loss per Share and Anti-dilutive Securities (Tables)

3 Months Ended

Mar. 31, 2024

Net Loss per Share and Anti-dilutive Securities

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


	Three Months Ended March 31,
(In thousands, except per share data)	2024		2023
Numerator:
Net loss	$	(11,664)	$	(22,088)

Denominator:
Weighted-average ordinary shares outstanding		48,283		62,934
Less: weighted-average ordinary shares subject to forfeiture		—		—
Weighted-average ordinary shares outstanding - basic and diluted		48,283		62,934

Net loss per share - basic and diluted	$	(0.24)	$	(0.35)

Schedule of anti-dilutive securities


	Three Months Ended March 31,
(In thousands)	2024	2023
Options	2,304	2,467
Restricted share units and performance-contingent RSUs deemed probable	848	1,775
Employee share purchase plan	109	47
Total	3,261	4,289

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Current assets:
Cash and cash equivalents	$ 53,835	$ 39,545
Short-term marketable securities	46,140	62,881
Receivables from collaborative arrangements	14,664	17,474
Prepaid clinical and development services	2,086	2,038
Other prepaid and current assets	7,569	11,603
Total current assets	124,294	133,541
Property and equipment, net	8,717	9,068
Operating lease assets	35,364	36,287
Future contingent milestone and royalty assets	194,200	194,200
Restricted cash	836	836
Other assets	7,896	8,067
Total assets	371,307	381,999
Current liabilities:
Accounts payable	1,686	1,524
Accrued personnel-related expenses	4,475	6,443
Accrued clinical and development expenses	1,399	2,246
Accrued general and administrative expenses	2,476	2,900
Operating lease liabilities	4,063	3,923
Tenant improvement payable to subleasee	6,490	6,490
Other accrued liabilities	1,073	1,241
Total current liabilities	21,662	24,767
Long-term operating lease liabilities	43,840	45,236
Future royalty payment contingency	28,417	27,788
Unrecognized tax benefits	67,075	65,294
Other long-term liabilities	5,445	5,919
Commitments and contingencies (Note 10)
Shareholders' Equity
Preferred shares, $0.00001 par value: 230 shares authorized, no shares issued or outstanding
Ordinary shares, $0.00001 par value per share: 200,000 shares authorized; 48,566 and 48,091 shares issued and outstanding at March 31, 2024 and December 31, 2023, respectively
Additional paid-in capital	1,125,677	1,122,164
Accumulated other comprehensive loss	(41)	(65)
Accumulated deficit	(920,768)	(909,104)
Total shareholders' equity	204,868	212,995
Total liabilities and shareholders' equity	$ 371,307	$ 381,999

Revenue (Tables)

3 Months Ended

Mar. 31, 2024

Revenue

Schedule of revenue recognized from collaborative arrangements


	Three Months Ended March 31,
(In thousands)	2024		2023
Viatris collaboration agreement – Amounts receivable from Viatris	$	14,503	$	10,411


	Three Months Ended March 31,
(In thousands)	2024		2023
YUPELRI net sales (Theravance Biopharma implied 35%)	$	19,329	$	16,434

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


	Three Months Ended March 31,
(In thousands)	2024		2023
Viatris	$	189	$	1,753

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Parenthetical) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Total share-based compensation expense	$ 5,229	$ 7,021
Research and development
Total share-based compensation expense	1,465	2,441
Selling, general and administrative
Total share-based compensation expense	$ 3,764	4,223
Restructuring and related expenses
Total share-based compensation expense		$ 357

Document and Entity Information - shares	3 Months Ended
Document and Entity Information - shares	Mar. 31, 2024	May 03, 2024
Document and Entity Information
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2024
Document Transition Report	false
Entity File Number	001-36033
Entity Registrant Name	THERAVANCE BIOPHARMA, INC.
Entity Incorporation, State or Country Code	KY
Entity Tax Identification Number	98-1226628
Entity Address, Address Line One	C/O Theravance Biopharma US, Inc.
Entity Address, Address Line Two	901 Gateway Boulevard
Entity Address, City or Town	South San Francisco
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	94080
City Area Code	650
Local Phone Number	808-6000
Title of 12(b) Security	Ordinary Share $0.00001 Par Value
Trading Symbol	TBPH
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		48,633,224
Entity Central Index Key	0001583107
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q1
Amendment Flag	false

Cash, Cash Equivalents, and Restricted Cash (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023	Dec. 31, 2022
Cash, Cash Equivalents, and Restricted Cash
Cash and cash equivalents	$ 53,835	$ 187,665	$ 39,545
Restricted cash	836	836
Total cash, cash equivalents, and restricted cash shown on the condensed consolidated statements of cash flows	54,671	188,501	$ 40,381	$ 299,008
Realized and unrealized foreign currency gain (losses)	$ (100)	$ 100

Organization and Summary of Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2024
Organization and Summary of Significant Accounting Policies
Basis of Presentation	Basis of Presentation The Company’s condensed consolidated financial statements as of March 31, 2024 and for the three months ended March 31, 2024 and 2023 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, 2023 financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission (“SEC”) on March 1, 2024. The results for the three months ended March 31, 2024 are not necessarily indicative of the results to be expected for the year ending December 31, 2024, 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.
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. Due to the inherent uncertainty in making estimates, actual results could differ materially from those estimates. The Company expects its cash, cash equivalents and marketable securities will be sufficient to fund its operations for at least the next twelve months from the issuance date of these condensed consolidated financial statements based on current operating plans and financial forecasts.
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, 2023.
Recently Issued Accounting Pronouncements Not Yet Adopted	Recently Issued Accounting Pronouncements Not Yet Adopted In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”). ASU 2023-09 requires entities to provide additional information in their tax rate reconciliation and additional disclosures about income taxes paid by jurisdiction. ASU 2023-09 is effective on a prospective basis for annual periods beginning after December 15, 2024. Early adoption is also permitted for annual financial statements that have not yet been issued or made available for issuance. The Company is evaluating the impact of adopting ASU 2023-09 on its consolidated financial statements income tax disclosures. The Company has evaluated other recently issued accounting pronouncements and does not currently believe that any of these pronouncements will have a material impact on its consolidated financial statements and related disclosures.

Subleases (Tables)

3 Months Ended

Mar. 31, 2024

Subleases

Schedule of company's sublease income


	Three Months Ended March 31,
(In thousands)	2024		2023
Sublease income	$	2,090	$	2,090

Investments and Fair Value Measurements - Schedule of Changes to the Contingent liability (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Development and Collaboration Agreement
Beginning balance	$ 27,788
Non-cash interest expense accretion	629	$ 550
Ending balance	28,417
Ampreloxetine Royalty Rights
Development and Collaboration Agreement
Beginning balance	27,788
Non-cash interest expense accretion	629
Ending balance	$ 28,417

Revenue - Reimbursement of R and D Costs (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Viatris
Research and Development Reimbursement
Total reduction to R and D expense	$ 189	$ 1,753

Commitments and Contingencies

3 Months Ended

Mar. 31, 2024

Commitments and Contingencies

Commitments and Contingencies

10. Commitments and Contingencies

Legal Proceedings

In the ordinary course of business, the Company may be subject to legal claims and regulatory actions that could have a material adverse effect on its business or financial position. The Company assesses it potential liability in such situations by analyzing the possible outcomes of various litigation, regulatory, and settlement strategies. If the Company determines that a material loss is probable and its amount can be reasonably estimated, it will accrue an

amount equal to the estimated loss. As of March 31, 2024, the Company did not accrue any estimated losses related to its ongoing legal proceedings.

Litigation – Patent Infringement

During January 2023, the Company received notice from Accord Healthcare, Inc.; Cipla USA, Inc. and Cipla Limited; Eugia Pharma Specialties Ltd.; Lupin Inc.; Mankind Pharma Ltd.; Orbicular Pharmaceutical Technologies Private Limited; and Teva Pharmaceuticals, Inc. (collectively, the “generic companies”), that they have each filed with FDA an abbreviated new drug application (“ANDA”), for a generic version of YUPELRI. The notices from the generic companies each included a paragraph IV certification with respect to five of the Company’s patents listed in FDA’s Orange Book for YUPELRI on the date of the Company’s receipt of the notice. The asserted patents relate generally to polymorphic forms of and a method of treatment using YUPELRI. In February 2023, the Company filed patent infringement suits against the generic companies in federal district court, including the United States District Court for the District of New Jersey, the U.S. District Court for the District of Delaware, and the U.S. District Court for the Middle District of North Carolina. The suits in Delaware and North Carolina have been dismissed, as all generic companies have agreed to venue in New Jersey. The complaint alleges that by filing the ANDAs, the generic companies have infringed five of the Company’s Orange Book listed patents. The Company is seeking a permanent injunction to prevent the generic companies from introducing a generic version of YUPELRI that would infringe its patents. As a result of this lawsuit, a stay of approval through May 2026 has been imposed by the FDA on the generic companies’ ANDAs pending any adverse court decision. Additional patents covering YUPELRI granted on July 4, 2023 and January 2, 2024 were subsequently listed in FDA’s Orange Book. The Company filed additional patent infringement suits in the U.S. District Court for the District of New Jersey during August 2023 and January 2024. These suits have been consolidated with the above action. Further, the original complaint was amended during December 2023 to include certain patents not listed in the Orange Book.

As of May 14, 2024, the Company has settled all litigation with Accord Healthcare, Inc.; Lupin Pharmaceuticals, Inc.; Orbicular Pharmaceutical Technologies Private Limited; and Teva Pharmaceuticals, Inc. pursuant to individual agreements in which the Company granted these companies a royalty-free, non-exclusive, non-sublicensable, non-transferable license to manufacture and market their respective generic versions of YUPELRI inhalation solution in the US on or after the licensed launch date of April 23, 2039, subject to certain exceptions as is customary in these type of agreements. As required by law, the settlements are subject to review by the U.S. Department of Justice and the Federal Trade Commission. The patent litigation against the three remaining generic companies, along with certain affiliates, remains pending.

Restructuring and Related Expenses (Details) - USD ($)
$ in Thousands

1 Months Ended

3 Months Ended

Mar. 31, 2023

2021 Corporate Restructuring Completion and 2023 Strategic Actions

Reduction in workforce (as a percent)

17.00%

Restructuring costs

^[1]

$ 1,574

Research and Development Laboratory Equipment

2021 Corporate Restructuring Completion and 2023 Strategic Actions

Restructuring costs

$ 1,600

Severance

2021 Corporate Restructuring Completion and 2023 Strategic Actions

Restructuring costs

1,600

1,200

Non-cash charges related to modification of equity-awards for terminated and remaining employee

$ 400

[1]	Amounts include share-based compensation expense as follows:

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References + Details

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands	Mar. 31, 2024	Dec. 31, 2023
CONSOLIDATED BALANCE SHEETS
Preferred shares, par value (in dollars per share)	$ 0.00001	$ 0.00001
Preferred shares, shares authorized (in shares)	230	230
Preferred shares, shares issued (in shares)	0	0
Preferred shares, outstanding shares (in shares)	0	0
Ordinary shares, par value (in dollars per share)	$ 0.00001	$ 0.00001
Ordinary shares, authorized shares (in shares)	200,000	200,000
Ordinary shares, shares issued (in shares)	48,566	48,091
Ordinary shares, shares outstanding (in shares)	48,566	48,091

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Operating activities
Net loss	$ (11,664)	$ (22,088)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	432	625
Amortization and accretion income, net	(354)	(678)
Future royalty payment contingency interest accretion	629	550
Share-based compensation	5,229	7,021
(Gain) loss on disposal of property and equipment		29
Amortization of right-of-use assets	1,101	1,031
Deferred income taxes	(513)
Changes in operating assets and liabilities:
Receivables from collaborative and licensing arrangements	2,810	4,515
Prepaid clinical and development services	(48)	(13)
Other prepaid and current assets	4,034	1,401
Right-of-use lease assets	(178)	(109)
Other assets	148	1,270
Accounts payable	184	1,002
Accrued personnel-related expenses, accrued clinical and development expenses, and other accrued liabilities	(3,396)	(4,337)
Deferred revenue		(6)
Operating lease liabilities	(1,256)	(966)
Unrecognized tax benefits	1,781
Other long-term liabilities	39	(468)
Net cash used in operating activities	(1,022)	(11,221)
Investing activities
Purchases of property and equipment	(91)	(938)
Purchases of marketable securities	(26,902)	(134,533)
Maturities of marketable securities	44,021	29,500
Sale of short-term investments and marketable securities		62,715
Proceeds from the sale of property and equipment		210
Net cash provided by (used in) investing activities	17,028	(43,046)
Financing activities
Ordinary share repurchases	(445)	(55,353)
Repurchase of shares to satisfy tax withholding	(1,271)	(887)
Net cash used in financing activities	(1,716)	(56,240)
Net increase (decrease) in cash, cash equivalents, and restricted cash	14,290	(110,507)
Cash, cash equivalents, and restricted cash at beginning of period	40,381	299,008
Cash, cash equivalents, and restricted cash at end of period	54,671	188,501
Supplemental disclosure of cash flow information
Cash paid for income taxes, net	$ (9)	7
Supplemental disclosure of non-cash activities
Recognition of tenant improvement allowance assigned to sublease		$ 6,490

Income Taxes

3 Months Ended

Mar. 31, 2024

Income Taxes

Income Taxes

9. Income Taxes

For the three months ended March 31, 2024, the Company recognized an income tax expense of $1.3 million. Although the Company incurred net operating losses on a consolidated basis, the income tax expense for the three months ended March 31, 2024 was primarily due to interest expense on uncertain tax positions taken in previous years.

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

The Company follows the accounting guidance related to accounting for income taxes which requires that a company reduce its deferred tax assets by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some portion or all of its deferred tax assets will not be realized. As of March 31, 2024, the Company does not believe that a valuation allowance against its deferred tax assets is needed for US federal tax purposes as it is more like than not able to fully utilize such attributes. As of March 31, 2024, the Company continues to maintain a full valuation allowance in other jurisdictions, predominantly in Ireland.

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 related to income tax matters in income tax expense.

The Company’s future income tax expense may be affected by such factors as changes in tax laws, regulations, its business, tax rates, interpretation of existing laws or regulations, the impact of accounting for share-based compensation, the impact of accounting for business combinations and other transactions, its international organization, shifts in the amount of income before tax earned in the US as compared with other regions in the world, and changes in overall levels of income before tax.

- 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.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480990/946-20-50-13

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h)(2))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org//740/tableOfContent

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
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-Name Accounting Standards Codification
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-Paragraph 21
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
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-Paragraph 1
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
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-Name Accounting Standards Codification
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-Paragraph 17
-Subparagraph (b)
-Publisher FASB
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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-Subparagraph (SAB TOPIC 6.I.5.Q1)
-Publisher FASB
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 11.C)
-Publisher FASB
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 30
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482603/740-30-50-2

+ Details

Commitments and Contingencies (Details) - item	3 Months Ended
Commitments and Contingencies (Details) - item	Mar. 31, 2024	Feb. 28, 2023	Jan. 31, 2023
Commitments and Contingencies
Number of patents listed in orange book		5	5
Number of pending litigations	3