Theravance to split in two

One company will focus on small-molecule discovery and development while the other will focus on managing rights to various potential royalty streams

Jeffrey Bouley
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Theravance Inc. recently announced that its board of directors has approved plans to separatethe businesses into two independent publicly traded companies, with the aim of providing two different business models that will enableinvestors to "align their investment philosophies with the strategicopportunities and financial objectives of the two independent companies."
Onecompany, referred to as Theravance Biopharma, will be a biopharmaceutical company focused on discovery, developmentand commercialization of small-molecule medicines in areas ofsignificant unmet medical need.
The othercompany, referred to as Royalty Management Co., will focus on managing all development and commercial responsibilitiesunder the LABA collaboration with GlaxoSmithKline (GSK) and associatedpotential royalty revenues from Relvar or Breo Ellipta (fluticasonefuroate/vilanterol: FF/VI), Anoro Ellipta (umeclidiniumbromide/vilanterol: UMEC/VI) and VI monotherapy, with the intention ofproviding a consistent return of capital to stockholders.
"Following a review of alternatives to maximize the value of ourportfolio, we have decided to separate our biopharmaceutical discovery,development and commercialization operations from our late-stagepartnered respiratory assets," said Rick E Winningham, CEO of Theravance. "We believe this separation will provide investors with theopportunity to unlock potential value from two disparate sets of assets,better align employee incentives and provide a consistent return ofcapital to stockholders of Royalty Management Co."
The goal of separating Theravance into two companies is to continue itsbusinesses in a new structure designed to unlock potential value,facilitate return of capital to stockholders and further its strategy ofadvancing medicines that address unmet medical needs. After theseparation, Theravance Biopharma will focus on Theravance's multivalentdiscovery capabilities and pipeline of programs, including itscardiovascular collaboration with Merck and its partnership agreementswith Alfa Wassermann, Clinigen and R-Pharm. Royalty Management Co willcontinue to focus on managing the rights to the significant potentialroyalty streams from certain products developed under the LABAcollaboration with GSK
SOURCE: Theravance news release

Jeffrey Bouley

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