Theravance Biopharma (TBPH) Q4 Loss Wider, Sales Drop Y/Y

Theravance Biopharma (NASDAQ:TBPH) reported fourth-quarter 2017 loss of $1.64 per share, wider than both the Zacks Consensus Estimate of a loss of $1.15 and the year-ago loss of $1.36.

Total revenues in the quarter plunged 21.1% year over year to $4.5 million compared with the prior-year figure. This downside can mainly be attributed to lower sales from the company’s sole marketed product, Vibativ (telavancin). However, the top line surpassed the Zacks Consensus Estimate of $4 million.

Theravance’ shares were down more than 2% on Feb 27 in after-hours trading following the earnings release, which reported wider loss. Moreover, the shares have underperformed the industry in a year’s time. The stock has lost 8.4% versus the industry’s 0.8% increase.

Quarterly Details

Vibativ generated U.S. revenues of $4.1 million in the fourth quarter, down 18% from the year-ago period. Sales decreased mainly due to the impact of generic competition in the United States.

Revenues from collaborations were $0.4 million compared with $0.7 million in the year-earlier quarter.

Research and development expenses were $51 million, up 21.4% from the year-ago period, mainly due to increases in employee-related costs and advancement of the company’s priority pipeline programs, partially offset by reduction in external expenses.

Selling, general & administrative expenses rose 44.6% to $20.9 million, primarily on higher employee-related costs.

2017 Results

Full-year sales slumped 68.3% year over year to $15.4 million. However, the number beat the Zacks Consensus Estimate of $14.5 million.

Full-year loss of $5.45 per share was wider than the year-ago tally of $4.26. Loss was also wider than the consensus mark of a loss of $4.85.

Pipeline and Other Updates

Earlier this February 2018, Theravance entered into a global collaboration agreement with Janssen, a subsidiary of Johnson & Johnson (NYSE:JNJ) , to jointly develop and commercialize its pan-Janus kinase inhibitor, TD-1473, for treatment of inflammatory intestinal diseases.

Pursuant to the above-mentioned contract, Theravance will be entitled to receive an upfront payment of $100 million and be also eligible to get potential payments of $900 million if J&J remains in the collaboration on completion of phase II activities.

Also in January, Theravance along with partner Mylan (NASDAQ:MYL) announced that the new drug application (NDA) for the pipeline candidate, revefenacin (TD-4208), has been accepted by the FDA for treatment of adults with chronic obstructive pulmonary disease. A response from the regulatory body is expected on Nov 13, 2018. The NDA acceptance was supported by positive data from two replicate pivotal phase III efficacy studies and a single 12-month, open-label, active comparator safety trial. In October 2016, the company reported positive data from both the phase III evaluations.

2018 Outlook

Theravance projects operating loss for 2018 in the range of $180-$200 million.

Theravance Biopharma, Inc. Price, Consensus and EPS Surprise

Theravance Biopharma, Inc. Price, Consensus and EPS Surprise | Theravance Biopharma, Inc. Quote

Zacks Rank & Key Pick

Theravance carries a Zacks Rank #3 (Hold). A better-ranked stock in the health care sector is Regeneron Pharmaceuticals (NASDAQ:REGN) , sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Regeneron’s earnings per share estimates have moved up from $17.13 to $18.65 and from $20.38 to $21.56 for 2018 and 2019, respectively, in the last 30 days. The company pulled off a positive earnings surprise in three of the last four quarters with an average beat of 9.15%.

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