Theravance Biopharma, Inc. Reports Second Quarter 2026 Financial Results and Provides Corporate Update

• Previously announced acquisition by Zymeworks expected to close in second half of 2026
• YUPELRI ® Collaboration Revenue increased 11% year-over-year**1, from $18.7 million to $20.7 million, driven by continued Net Sales growth and improved operating leverage
• Organizational restructuring and cost reduction initiatives delivered 35% reduction in operating expenses year-over-year (excluding restructuring and transaction costs)
• Q2 2026 TRELEGY net sales, reported by GSK, of approximately $1.0 billion; high confidence in achieving the $100 million 2026 milestone payment**2
• Quarter-end cash balance of $388 million and no debt

DUBLIN, Aug. 10, 2026 — Theravance Biopharma, Inc. ("Theravance Biopharma" or the "Company") (NASDAQ: TBPH) today reported financial and operational results for the second quarter of 2026.

"During the second quarter, we entered into a definitive agreement to be acquired by Zymeworks, marking the culmination of a comprehensive strategic review process and what we believe achieves the greatest value for Theravance Biopharma shareholders," said Rick E Winningham, Chief Executive Officer of Theravance Biopharma. "At the same time, YUPELRI® delivered another strong quarter, underscoring the durability and value of our core commercial asset and the continued execution of our collaboration with Viatris. We continued to execute well against our restructuring plan and expect to close the Zymeworks transaction in the second half of 2026 subject to shareholder approval and customary closing conditions."

Pending Acquisition by Zymeworks

On June 29, 2026, following a comprehensive strategic alternatives review process conducted by the Company's Strategic Review Committee and Board of Directors, Theravance Biopharma announced that it had entered into a definitive agreement pursuant to which Zymeworks Inc. will acquire the Company for $17.00 per share in cash, plus a contingent value right (CVR) entitling shareholders to 80% of net proceeds realized from any future license, divestiture or other monetization of ampreloxetine over the next ten years.

The transaction is expected to close in the second half of 2026, subject to approval by Theravance Biopharma shareholders and satisfaction of other customary closing conditions.

Operational Highlights

YUPELRI® (revefenacin) inhalation solution, the first and only once-daily, nebulized LAMA (long-acting muscarinic antagonist) bronchodilator approved in the U.S. for the maintenance treatment of patients with chronic obstructive pulmonary disease (COPD):

• Quarterly U.S. net sales of $70.7 million, recognized by Viatris, in Q2 2026, increasing 7% year-over-year (YoY) (Q2 2026 vs Q2 2025)1 driven by customer demand growth of 10% YoY (Q2 2026 vs Q2 2025).3
• Increased doses pulled through the hospital channel by 25% YoY (Q2 2026 vs Q2 2025), reflecting another excellent quarter of growth.4

TRELEGY

GSK reported second quarter 2026 global net sales of approximately $1.0 billion and year-to-date net sales of approximately $1.9 billion5:

• FY 2025 global net sales of approximately $3.9 billion triggered a $50M milestone payment from Royalty Pharma, with cash received in February 2026.
• FY 2026 global net sales of ~$3.5 billion required to trigger an additional $100M milestone payment from Royalty Pharma.

Organizational Restructuring Update

• Following the announcement of the Company's Phase 3 CYPRESS results in March 2026, Theravance Biopharma has made substantial progress on its organizational restructuring.
• As an indicator of this progress, operating expenses (excluding restructuring and transaction costs) decreased 35% year-over-year in Q2 2026 compared to Q2 2025, with additional reductions expected in 2H 2026.
• The restructuring is expected to reduce operating expenses by approximately 60%, relative to 2025 actuals of $111.1 million. The full run-rate cost savings of approximately $70 million are expected to materialize in the second half of 2026. This is expected to result in approximately $60 - $70 million of annualized cash flow (excluding restructuring and transaction costs), with the benefit expected to be realized beginning in the second half of 2026.

Second Quarter Financial Results

• Revenue: Total revenue for the second quarter of 2026 was $20.7 million, consisting entirely of Viatris collaboration revenue. Viatris collaboration revenue increased by $2.0 million, or 11%, in the second quarter compared to the same period in 2025. The Viatris collaboration revenue represents amounts receivable from Viatris and comprises the Company's 35% share of net sales of YUPELRI, as well as its proportionate amount of the total shared commercial costs incurred by the two companies. The non-shared YUPELRI costs incurred by Theravance Biopharma are recorded within operating expenses. While Viatris records the total net sales of YUPELRI within its financial statements, Theravance Biopharma's implied 35% share of net sales of YUPELRI for the second quarter of 2026 was $24.7 million which represented a 7% increase compared to the same period in 2025.
• Research and Development (R&D) Expenses: R&D expenses for the second quarter of 2026 were $4.7 million, compared to $10.5 million in the same period in 2025. The reduction was driven by the corporate restructuring announced in March 2026 and the ongoing wind-down of the CYPRESS clinical trial. Second quarter R&D expenses included total non-cash share-based compensation of $0.6 million.
• Selling, General and Administrative (SG&A) Expenses: SG&A expenses for the second quarter of 2026 were $14.2 million, compared to $18.4 million in the same period in 2025. The reduction was primarily driven by the corporate restructuring announced in March 2026. Second quarter SG&A expenses included total non-cash share-based compensation of $3.6 million.
• Restructuring Expenses: Restructuring expenses for the second quarter of 2026 were $4.0 million and were comprised of severance costs and termination-related benefits. Cash restructuring expenses were $2.2 million and non-cash restructuring expenses were $1.8 million.
• Transaction-Related Expenses: Transaction-related expenses associated with the pending acquisition by Zymeworks were $6.1 million in the second quarter of 2026 and were related to legal and financial advisory services.
• Share-Based Compensation: Total share-based compensation expenses for the second quarter of 2026 were $6.0 million which included restructuring-related share-based compensation expenses. Excluding restructuring-related expenses, share-based compensation was $4.1 million, compared to $4.5 million in the same period in 2025. Share-based compensation expenses for the second quarter of 2026 consisted of $0.6 million for R&D, $3.6 million for SG&A, and $1.8 million related to the restructuring.
• Net Loss: Net loss was $5.9 million in the second quarter of 2026 compared to net income of $54.8 million in the same period in 2025. The second quarter of 2025 net income was primarily due to a $75.1 million net gain on contingent milestone and royalty assets (representing the sale of our remaining interest in TRELEGY royalties in June 2025).
• Non-GAAP Net Income (Loss) from Operations****6: Non-GAAP net income from operations was $9.5 million in the second quarter of 2026 compared to a non-GAAP net loss from operations of $4.2 million in the same period in 2025. See the section titled "Non-GAAP Financial Measures" for more information.
• Cash Position: Cash, cash equivalents and marketable securities totaled $387.7 million as of June 30, 2026.
• Shares Outstanding: The Company had 51,890,754 ordinary shares outstanding as of June 30, 2026.

Conference Call

Earnings results are being released via press release only. The Company will not host a conference call or webcast to discuss quarterly results.

About Theravance Biopharma

Theravance Biopharma, Inc.'s focus is to deliver Medicines that Make a Difference® in people's lives. In pursuit of its purpose, Theravance Biopharma leverages decades of expertise, which has led to the development of FDA-approved YUPELRI® (revefenacin) inhalation solution indicated for the maintenance treatment of patients with chronic obstructive pulmonary disease (COPD). The Company is committed to creating/driving shareholder value.

For more information, please visit www.theravance.com.

THERAVANCE BIOPHARMA®, THERAVANCE® and the Cross/Star logo are registered trademarks of the Theravance Biopharma group of companies (in the U.S. and certain other countries).

YUPELRI® is a registered trademark of Viatris Specialty LLC. Trademarks, trade names or service marks of other companies appearing on this press release are the property of their respective owners.

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1

In the U.S., Viatris is leading the commercialization of YUPELRI, and the Company co-promotes the product under a profit and loss sharing arrangement (65% to Viatris; 35% to the Company).

2

Payment from Royalty Pharma (RP) will be triggered if RP receives certain minimum royalty payments from GSK based on TRELEGY global net sales.

3

Source: Viatris Customer Demand (Q2'26).

4

Source: IQVIA DDD, HDS, VA and Non-Reporting Hospital through Jun '26.

5

GSK-reported Net Sales in USD.

6

Non-GAAP profit (loss) consists of GAAP net income (loss) before taxes less (i) share-based compensation expense, (ii) non-cash interest expense, and (iii) non-recurring revenue and income (expense) items. See the section titled "Non-GAAP Financial Measures" for more information.

THERAVANCE BIOPHARMA, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

June 30,

December 31,

2026

2025

Assets

(Unaudited)

(1)

Current assets:

Cash and cash equivalents and short-term marketable securities

$

387,657

$

315,357

Receivables from collaborative arrangements

20,381

45,539

Receivables from milestone and royalty assets

50,000

Other prepaid and current assets

8,624

7,564

Total current assets

416,662

418,460

Long-term marketable securities

11,128

Property and equipment, net

5,169

5,895

Operating lease assets

21,926

24,371

Restricted cash

836

836

Other assets

25,177

24,880

Total assets

$

469,770

$

485,570

Liabilities and Shareholders' Equity

Current liabilities

$

30,766

$

38,302

Long-term operating lease liabilities

27,774

31,758

Future royalty payment contingency

32,795

32,795

Unrecognized tax benefits

88,486

85,679

Other long-term liabilities

244

313

Shareholders' equity

289,705

296,723

Total liabilities and shareholders' equity

$

469,770

$

485,570

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(1) The condensed consolidated balance sheet as of December 31, 2025 has been derived from the audited consolidated financial statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2025.

THERAVANCE BIOPHARMA, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

Three Months Ended June 30,

Six Months Ended June 30,

2026

2025

2026

2025

(Unaudited)

(Unaudited)

Revenue:

Viatris collaboration agreement (1)

$

20,731

$

18,695

$

38,430

$

34,083

Licensing revenue

7,500

7,500

Total revenue

20,731

26,195

38,430

41,583

Costs and expenses:

Research and development (2)

4,712

10,490

10,541

21,942

Selling, general and administrative (2)

14,176

18,430

31,896

36,800

Restructuring expenses (2) (3)

4,031

7,664

Transaction-related expenses

6,089

6,089

Total costs and expenses

29,008

28,920

56,190

58,742

Loss from operations

(8,277)

(2,725)

(17,760)

(17,159)

Net gain on realized contingent milestone and royalty assets

75,137

75,137

Interest expense (non-cash)

(663)

(1,306)

Interest income and other income, net

3,486

1,457

6,499

2,396

Income (loss) before income taxes

(4,791)

73,206

(11,261)

59,068

Provision for income tax (expense) benefit

(1,107)

(18,371)

430

(17,812)

Net income (loss)

$

(5,898)

$

54,835

$

(10,831)

$

41,256

Net income (loss) per share:

Net income (loss) per share - basic

$

(0.11)

$

1.09

$

(0.21)

$

0.83

Net income (loss) per share - diluted

$

(0.11)

$

1.08

$

(0.21)

$

0.81

Shares used to compute net income (loss) per share - basic

51,667

50,177

51,474

49,943

Shares used to compute net income (loss) per share - diluted

51,667

50,726

51,474

50,685

Non-GAAP net income (loss)

$

9,467

$

(4,225)

$

10,106

$

(12,843)

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(1) While Viatris, Inc. records the total YUPELRI net sales, the Company is entitled to a 35% share of the net profit (loss) pursuant to a co-promotion agreement

with Viatris as presented below:

Three Months Ended June 30,

Six Months Ended June 30,

(In thousands)

2026

2025

2026

2025

YUPELRI net sales (100% recorded by Viatris)

$

70,666

$

66,330

$

133,097

$

124,674

YUPELRI net sales (Theravance Biopharma implied 35%)

24,733

23,216

46,584

43,636

(2) Amounts include share-based compensation expense as follows:

Three Months Ended June 30,

Six Months Ended June 30,

(In thousands)

2026

2025

2026

2025

Research and development

$

566

$

987

$

1,193

$

2,057

Selling, general and administrative

3,572

3,556

6,421

7,363

Restructuring expenses

1,852

2,880

Total share-based compensation expense

$

5,990

$

4,543

$

10,494

$

9,420

(3) Restructuring expenses were comprised of:

Three Months Ended June 30,

Six Months Ended June 30,

(In thousands)

2026

2025

2026

2025

Cash-related expenses

$

2,179

$

$

4,784

$

Non-cash related expenses

1,852

2,880

Total restructuring expenses

$

4,031

$

$

7,664

$

THERAVANCE BIOPHARMA, INC.

Reconciliation of GAAP Net Income (Loss) to Non-GAAP Net Income (Loss)

(In thousands)

Three Months Ended June 30,

Six Months Ended June 30,

2026

2025

2026

2025

(Unaudited)

(Unaudited)

GAAP net income (loss)

$

(5,898)

$

54,835

$

(10,831)

$

41,256

Adjustments:

Licensing revenue (1)

(7,500)

(7,500)

Net gain on realized contingent milestone and royalty assets (1)

(75,137)

(75,137)

Share-based compensation expense

5,990

4,543

10,494

9,420

Non-cash interest expense

663

1,306

Income tax expense (benefit)

1,107

18,371

(430)

17,812

Restructuring expense (excl. share-based compensation) (1)

2,179

4,784

Transaction-related expense (1)

6,089

6,089

Non-GAAP net income (loss)

$

9,467

$

(4,225)

$

10,106

$

(12,843)

(1) Non-recurring item