Q3 2024 Earnings Summary
- Strong growth in YUPELRI sales: Theravance Biopharma reported a 14% increase in demand for YUPELRI and a 7% year-over-year growth in net sales, reaching an all-time high of approximately $62 million in net sales for the quarter. The company is optimistic about net sales progression for the brand into 2025 and beyond due to strong demand growth and strategic initiatives with Viatris.
- Strategic Review Committee to unlock shareholder value: The company has formed a Strategic Review Committee to explore alternatives to unlock value from its assets, including YUPELRI, TRELEGY, and ampreloxetine, as well as its tax attributes. This proactive approach indicates potential value-enhancing actions that could benefit shareholders.
- Progress in pivotal CYPRESS study for ampreloxetine: Theravance is making significant progress in the CYPRESS Phase III study for ampreloxetine in neurogenic orthostatic hypotension (nOH) and Multiple System Atrophy (MSA). The vast majority of clinical sites have been activated, keeping the company on track to achieve top-line results within approximately 12 months. Successful results could represent a significant milestone for the company.
- YUPELRI is experiencing net pricing headwinds due to increased demand in lower-margin channels, which may continue to pressure margins until early 2025.
- The formation of a Strategic Review Committee to explore strategic alternatives may indicate challenges in unlocking shareholder value, suggesting that intrinsic value is not currently reflected in the share price.
- Competition from new therapies like ensifentrine may impact YUPELRI's market share, and while early feedback is limited, concomitant use of ensifentrine could affect prescribing patterns.
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Strategic Alternatives
Q: What prompted forming the Strategic Review Committee?
A: The Board determined that now is an appropriate time to undertake a formal review with Lazard's help to unlock the value of our assets. With the continued strength of TRELEGY, upcoming milestones, YUPELRI's growth, China approval, and upcoming data from the CYPRESS study, we believe our assets are appropriately valued. We're proactively mapping out plans to better realize this value for the benefit of our shareholders. -
YUPELRI Growth Drivers
Q: What's driving the 40% year-over-year increase in YUPELRI hospital doses sold?
A: The growth is driven by building upon the number of formulary approvals in the U.S. and achieving therapeutic interchange agreements, which place YUPELRI as the choice when a LAMA is prescribed in the EMR system. Last quarter, we increased therapeutic interchange in our focus accounts to 50%. In accounts with therapeutic interchange, we have significantly higher market share at 36%, compared to 19% overall. These wins are continuing to drive efforts in the hospital channel. -
ASP Impact and 2025 Expectations
Q: How is impacting YUPELRI's ASP affecting 2025 expectations?
A: Improvement in ASP has a two-quarter lag once initiatives are implemented. Success in Q3 was driven by supplier diversification and execution across community, hospital, and long-term care channels. We expect overall price improvement in early 2025. Combined with strong demand growth over the past two quarters, we're optimistic about net sales progression for YUPELRI into 2025 and beyond. -
Impact of Ensifentrine Launch
Q: Are you seeing changes in YUPELRI prescribing post ensifentrine launch?
A: It's a bit too early to see the full impact, but anecdotally, we're hearing that ensifentrine is being added on to YUPELRI, with multiple examples of concomitant use. As we get another quarter in, we'll have full visibility into Medicare Part B prescribing and can comment more readily. -
CYPRESS Study Progress
Q: What's the status of CYPRESS study site activations?
A: We're pleased that we now have the vast majority of our sites activated. Over the last quarter, we've progressed the remaining key sites, and almost all sites are now over the line at this point.