The board of directors of Theravance, Inc. has decided to split the organization into two separate companies by late 2013 or early 2014 in a move “designed to unlock potential value, facilitate return of capital to stockholders and further strategy of advancing medicines that address unmet medical needs,” the company has announced.
One company, called Theravance Biopharma will continue development of small molecule drugs; the other, called “Royalty Management Co” in the press release will manage activities related to the dry powder inhalers it has developed in partnership with GSK: Relvar/Breo Ellipta fluticasone furoate/vilanterol DPI, the Anoro Ellipta umeclidinium bromide/vilanterol DPI (held by a subsidiary LLC), and vilanterol monotherapy. Both of the new companies will be publicly traded.
The move comes shortly after an FDA advisory committee recommended approval of Breo Ellipta, and GSK and Theravance filed an application for Anoro Ellipta in Japan.
Theravance CEO Rick E Winningham explained, “Following a review of alternatives to maximize the value of our portfolio, we have decided to separate our biopharmaceutical discovery, development, and commercialization operations from our late-stage partnered respiratory assets. We believe this separation will provide investors with the opportunity to unlock potential value from two disparate sets of assets, better align employee incentives and provide a consistent return of capital to stockholders of Royalty Management Company.”
“Royalty Management Co,” which will operate under a yet-to-be-determined name, will also manage another inhaled product in partnership with GSK, a bifunctional muscarinic antagonist-beta2 agonist (MABA), as well as a MABA/ICS combination and a umeclidinium bromide/vilanterol/fluticasone furoate (UMEC/VI/FF) combination; however, the company says, “98% of the LLC’s economic interests in those programs will accrue to Theravance Biopharma and 2% will accrue to Royalty Management Co.”
The company says that it will capitalize Theravance Biopharma, which may operate under a new name, with approximately $300 million.
Read the Theravance press release.
