Theravance, Inc. is a biopharmaceutical company engaged in the discovery, development, and commercialization of small molecule medicines in the U.S. The company employs multivalent technoogy, which involves the simultaneous attachment of a single molecule to multiple binding sites on one or more biological targets. This technology aims to create best in class drugs with improved potency, and selectivity. The company develops medicines for respiratory diseases, bacterial infections, CNS/pain, and gastrointestinal motility dysfunction.
After a three year regulatory battle with the FDA, the company received approval of its first drug VIBATIV™ in 2009 for the treatment of complicated skin and skin structure infections (cSSSI) caused by Gram-positive bacteria, including resistant pathogens such as methicillin-resistant Staphylococcus aureus (MRSA). The drug is also approved in Canada and is under review by the European Medicines Agency (EMA) for the treatment of nosocomial pneumonia (NP) and complicated skin and soft tissue infections (cSSTI) in adults.
The company partners with pharmaceutical companies primarily for late stage development, Phase III and later, and commercialization. Theravance has a collaboration arrangement with Astellas Pharma (MUC:YPH) for the global development and commercialization of VIBATIV™. Additionally, the company has agreements with GlaxoSmithKline (GSK) to develop and commercialize long-acting beta2 agonist (LABA) product candidates for the treatment of asthma and chronic obstructive pulmonary diseases and AstraZeneca (AB), to develop and commercialize an intravenous anesthetic compound.
With strong collaborations with such big players in the pharmaceutical space, Theravance is well positioned to take advantage of the growing trend that is sure to benefit the pharmaceutical industry on a mid to long term horizon, which is the world's aging population. Drugs are disproportionally used by older populations and so should support solid growth for the industry.
With a limited amount of revenue from VIBATIV™, Theravance relies on strategic alliances, and the milestone payments associated with them, to progress drug candidates past Phase II in development. In 2004 Therevance enetered into its largest alliance where GSK received an option to license candidates in development by Theravance before September 2007; if GSK opted-in they are responsible for all future development, manufacturing and commercialization activities for product candidates in that program.
The alliance with GSK has been the driver behind Theravnace's RELOVAIR™ program for the treatment of COPD and asthma, deemed the "Beyond Advair" program. The program is working to develop a once-daily LABA (vilanterol) combined with a once-a-day inhaled corticosteroid for the treatment of COPD and asthma. In the first quarter of 2010 the program's first Phase III trial began. As of May 2011, the program was in three Phase III trials, with results as early as the end of 2011.
Reflecting the growing confidence that GSK has in Theravance, at the end of 2010 the company raised its share in Theravance from 12% to 19% at a cost of about $130 million.
Beginning in 2009, the FDA implemented a series of reforms that include stricter monitoring of drug adverse events, more funding for the agency, stronger ability to force product recalls, more scientific expertise within the agency, more transparency. Even before 2009 the result has been a much more conservative FDA, demanding more product information. A clear example of this is the fact that the NDA for Telavancin (VIBATIV) was submitted in 2006 and after many regulatory hurdles the drug was not approved until 2009.
One macro trend that is sure to benefit the pharmaceutical industry on a mid to long term horizon is the world's aging population. Increased life expectancy coupled with decreased fertility in developed nations has produced a population that is, as a whole, older. In the United States, Western Europe and Japan the median age has been on the rise for decades now and this trend is likely to accelerate with the upcoming wave of aging baby boomers. According to the United Nations, the population of people aged over 60 in the world is expected to rise dramatically from 606 million in 2000 to nearly 2 billion in the year 2050. In developed nations, the United Nations predict that people aged over 60 will compose almost 35% of the population by 2050 opposed to under 20% in the year 2000. Drugs are disproportionally used by older populations and so should support solid growth for the industry as a whole.
Major competitors to Theravance include GSK, Cubist Pharmaceuticals (CBST), Pfizer (PFE), and AstraZeneca (AZN). Even though it has alliances with some of these companies, they also represent competitors because they are developing similar disease area drugs.
GlaxoSmithKline (GSK)- is a global healthcare group, its principal pharmaceutical products include medicines in the therapeutic areas, such as respiratory, anti-virals, central nervous system, cardiovascular and urogenital, metabolic, anti-bacterials, oncology and emesis, dermatalogicals and vaccines.
Cubist Pharmaceuticals (CBST)- The company's primary drug, CUBICIN (daptomycin for injection) is a direct competitor of VIBATIV, it is a once-daily, bactericidal, intravenous (I.V.) antibiotic with activity against certain Gram-positive organisms, including methicillin-resistant Staphylococcus aureus (S. aureus), (MRSA).