Theravance Biopharma, Inc. (NASDAQ:TBPH) has entered into a settlement agreement with Qilu Pharmaceutical Co., Ltd. regarding patent litigation over YUPELRI® (revefenacin) inhalation solution, according to a recent 8-K filing.
The agreement, dated September 18, 2024, resolves disputes arising from Qilu's attempt to market a generic version of YUPELRI® before the expiration of the patents held by Theravance.
Under the terms of the settlement, Theravance and Mylan (NASDAQ:VTRS), the exclusive sub-licensee, have granted Qilu a license to produce and sell its generic version in the United States starting on April 23, 2039. This license will be royalty-free and includes several standard exceptions. The settlement is currently under review by the U.S. Department of Justice and the Federal Trade Commission as per regulatory requirements.
The litigation forms part of a broader series of lawsuits under the Hatch-Waxman Act, initiated by Theravance and Mylan against multiple abbreviated new drug application (ANDA) filers. The ongoing cases against other ANDA filers, including Cipla Limited, Eugia Pharma Specialities Ltd., and Mankind Pharma Ltd., along with their affiliates, are unaffected by this settlement.
In other recent news, Theravance Biopharma reported a modest decrease in net sales for its product Yupelri in the second quarter, reaching $54.5 million. This 1% dip from the previous year was attributed to changes in the brand's channel mix. Despite this, Theravance Biopharma anticipates price improvements in the upcoming quarters and remains optimistic about Yupelri's long-term growth potential in the US market for COPD maintenance treatment.
Furthermore, the company's Ampreloxetine program experienced delays, with the last patient enrollment for the CYPRESS study now expected in mid-2025. This setback was due to extended lead times for site activations at major US centers.
H.C. Wainwright maintained a Buy rating on Theravance Biopharma shares, while TD Cowen revised its outlook on the company, lowering the price target to $9 from the previous $10, and maintaining a Hold rating on the stock. The company also reported a net loss of $17 million, with cash reserves of $96 million.
InvestingPro Insights
As Theravance Biopharma, Inc. (NASDAQ:TBPH) navigates through its patent litigation and reaches settlement agreements, investors and stakeholders may find it beneficial to consider some key financial metrics and analyst insights. According to InvestingPro, Theravance Biopharma holds more cash than debt on its balance sheet, which could provide financial flexibility in its operations and potential settlement negotiations. Moreover, the company's management has been actively engaged in share buybacks, signaling confidence in the company's value.
However, it's important for investors to be aware of the challenges ahead. Analysts have revised their earnings forecasts downwards for the upcoming period, and the company is not expected to be profitable this year. Despite a revenue growth of 20.97% over the last twelve months as of Q2 2024, Theravance's operating income margin remains negative at -62.82%, reflecting the ongoing costs that impact profitability.
The market capitalization of Theravance stands at approximately $391.87 million, with a negative P/E ratio of -8.91. While the company does not pay dividends, its shareholder yield is considered high, which could be attractive to certain types of investors. For those interested in more detailed analysis, there are additional InvestingPro Tips available on the Theravance Biopharma InvestingPro page, which can provide deeper insights into the company's financial health and future prospects.
With the next earnings date slated for November 5, 2024, and an InvestingPro fair value estimate at $9.58, compared to the previous close price of $8.01, investors should monitor the company's performance closely as it may present investment opportunities based on the unfolding market dynamics and the outcomes of ongoing patent litigations.
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