Theravance Inc (THRX), GlaxoSmithKline plc (ADR) (GSK): Which of These COPD Treatments Will Come Out on Top?

Page 1 of 2

To most people, cigarettes are often associated with lung cancer. However, smoking also causes other severe respiratory problems, such as COPD (chronic obstructive pulmonary disease). COPD occurs as a result of emphysema, which breaks down lung tissues — causing chronic cough, increased sputum production, and shortness of breath. COPD is currently the third leading cause of death in the United States, and is estimated to cost the country $42.6 billion in healthcare and productivity costs annually. Unlike asthma, COPD is hard to reverse, and generally worsens over time.

Traditional treatments for COPD include inhaled bronchodilators, vaccinations, oxygen therapy, and rehabilitation. However, most of these treatments are considered inadequate, with a high degree of “exacerbations” in which patients’ conditions gradually worsen. Therefore, Wall Street perked up on news that three major pharmaceutical companies are introducing some new COPD treatments for this under-penetrated market.

Theravance Inc (NASDAQ:THRX) and GlaxoSmithKline plc (ADR) (NYSE:GSK)

Theravance Inc (NASDAQ:THRX) primarily focuses on treatments for respiratory disease, bacterial infections, and central nervous system ailments. However, it mostly relies on strategic collaborations with larger companies to help cover R&D and marketing costs. Theravance’s primary pulmonary and respiratory programs — Revlar/Breo, Anoro, and Maba — were all developed through partnerships with GlaxoSmithKline plc (ADR) (NYSE:GSK).

Theravance Inc (NASDAQ:THRX)Theravance Inc (NASDAQ:THRX) and GlaxoSmithKline plc (ADR) (NYSE:GSK)’s main CPOD treatment, Breo Ellipta (also known as Revlar Ellipta), was approved by the FDA in May. It is the first once-daily inhaled corticosteroid long-acting treatment for COPD. Since its approval, Theravance shares have risen 17%. Breo Ellipta is a long-term maintenance therapy for COPD sufferers, designed to reduce airflow obstructions and exacerbations. The drug is expected to hit the market in the third or fourth quarter this year.

Not a one-trick pony

However, investors shouldn’t dismiss Theravance Inc (NASDAQ:THRX) as another one-trick pony biotech stock. The company still generates substantial revenue from its other treatments, which helped it post a narrower than expected loss of $0.37 per share last quarter. This was a slight improvement over the loss of $0.42 it reported in the prior year quarter, and also topped analyst estimates by $0.22 per share. Revenue, however, declined slightly from $1.4 million to $1.3 million, falling short of the $4 million that analysts had expected.

Theravance Inc (NASDAQ:THRX) also has other treatments in its development pipeline, including treatments for bacterial infections and ADHD, but its respiratory drugs remain the primary reason for investing in the company. However, the company’s aggressive development of its pipeline caused R&D expenses to rise 7.4% year-on-year to $31.7 million, while general and administrative expenses spiked 50% to $11.4 million due to higher legal and accounting costs.

Theravance Inc (NASDAQ:THRX) is also gearing up to split into two separate publicly traded companies, Royalty Management Company and Theravance Biopharma. Royalty Management will retain the development of respiratory candidates, while Theravance will focus on the discovery, development, and commercialization of small-molecule therapies focusing on untapped markets.

Novartis nipping at their heels

Another rising name in COPD treatments is diversified pharma giant Novartis AG (ADR) (NYSE:NVS). Novartis has been developing a once-daily bronchodilator inhaler, known as the Ultibro Breezhaler, aimed at relieving the symptoms of COPD. Ultibro was developed through a combination of two bronchodilators – indacaterol and glycopyrronium bromide, which significantly decreased the rate of exacerbations during clinical trials. Indacaterol relaxes the muscles of the airways as glycopyrronium dilates them.

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 44 percentage points in 21 months Learn how!

Lists

The Top 10 States With Fastest Internet Speeds

10 Best Places to Visit in USA in August

Top 10 Cities to Visit Before You Die

Top 10 Genetically Modified Food In the US

15 Highest Grossing Movies Opening Weekend

5 Best Poker Books For Beginners

10 Strategies Hedge Funds Use to Make Huge Returns

Top 10 Fast Food Franchises to Buy

10 Best Places to Visit in Canada

Best Summer Jobs for Teachers

10 Youngest Hedge Fund Billionaires

Top 10 One Hit Wonders of the 90s

Fastest Growing Cities In America

Top 10 U.S. Cities for Freelancers

Top 9 Most Popular Free iPhone Apps

Top 10 Least Expensive Private Business Schools in the US

Top 15 Most Expensive Countries in the World – 2014

Top Businesses to Invest In

Top 5 Things You Might Be Doing Wrong With Your Business

Top 5 Strategic Technology Trends in 2014

Top Rags to Riches Stories

Parenting Behavior That Promotes Future Leaders

Top 5 Mistakes Made by Small Businesses

Top 5 Most Common and Potentially Devastating Financial Blunders

Top 5 Highest Paying Jobs for Web Designers

Top 6 Most Respected Professions that Also Pay Well

Top 5 Pitfalls Investors Should Avoid

Top 6 Lawyers and Policy Makers Under 30

Top 6 New Year’s Resolutions for Entrepreneurs

Top 7 Locations to Check in on Facebook

Top 5 Mistakes made by Rookie eBay Sellers

Top 7 eBook Publishers in 2013

Top 6 Health Industry Trends in 2014

5 Lessons for Entrepreneurs from Seth Godin

Top 5 Success Tips from Jordan Belfort – the Wolf of Wall Street

Best Master’s in Finance Degree Programs

Top 6 Earning Celebrities Over 50

The most expensive sports to play

Top 7 Earning Celebrities Under 25

Best 7 Online Courses to Take: Free Finance MOOCs

Top 6 Bad Habits that Promote Failure

20 Most Valuable Soccer Teams in the World in 2013

12 Most Expensive Countries for Foreign Students

Top 30 Most Influential Women in the World

Top 20 Most Expensive New Year Eve Shows

Top 5 Best Vocational Careers

Top 10 Jobs for 2014 by Salary Gain (Predictions)

Top 5 Digital Trends for 2014

Top 6 Things You Can Do To Increase Your Productivity

Top 9 Trending Smartphones in 2013

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!