Theravance Biopharma's YUPELRI NMPA Approval: A Strategic Boost to Diversified Revenue Streams and Financial Flexibility

Theravance Biopharma (NASDAQ: TBPH) has secured a pivotal regulatory milestone with the NMPA approval of YUPELRI® (revefenacin) in China, marking the first once-daily nebulized long-acting muscarinic antagonist (LAMA) for COPD. This achievement not only unlocks immediate financial upside but also underscores the company's strategic pivot toward diversified revenue streams and low-risk commercial partnerships. With a robust cash position and a late-stage pipeline showing promise, Theravance emerges as a compelling play in underpenetrated markets.

The China Approval: Immediate Cash and Future Royalties

The NMPA approval on June 26, 2025, triggered a $7.5 million milestone payment from partner Viatris, which will bolster Theravance's balance sheet in Q3 2025. Crucially, this deal carries minimal risk: Viatris assumes all commercialization costs in China, while Theravance retains eligibility for up to $37.5 million in sales-based milestones and 14%-20% tiered royalties on net sales. This structure aligns with Theravance's “asset-light” strategy, maximizing upside while minimizing operational exposure.

YUPELRI's entry into China's COPD market—estimated at $2.5 billion annually—could capitalize on its unique once-daily formulation, which addresses the underpenetrated nebulized LAMA segment. With COPD affecting over 90 million Chinese adults, the drug's convenience and efficacy could drive adoption in a population underserved by existing therapies.

Financial Strength Anchored by GSK and TRELEGY Synergies

Theravance's cash reserves now exceed $356 million, combining its March 2025 balance of $131 million with a $225 million infusion from GlaxoSmithKline (GSK). This capital influx stems from the sale of GSK's stake in TRELEGY® (fluticasone/vilanterol/umeclidinium) royalties, a blockbuster COPD inhaler. Notably, Theravance retains a 35% share of U.S. YUPELRI profits and stands to gain up to $150 million in near-term milestone payments from Royalty Pharma for TRELEGY's continued success.

The GSK transaction not only strengthens Theravance's liquidity but also positions it to pursue high-value partnerships. The company's financial flexibility is further supported by its royalty-driven model, which avoids upfront R&D costs while sharing in commercial upside.

The CYPRESS Trial: A Catalyst for Rare Disease Growth

While YUPELRI dominates the near-term narrative, Theravance's pipeline offers additional catalysts. The Phase 3 CYPRESS trial for ampreloxetine—targeting symptomatic neurogenic orthostatic hypotension (nOH) in patients with multiple system atrophy (MSA)—is nearing completion. Enrollment in the open-label phase is expected to conclude by late summer 2025, with top-line data anticipated in early 2026.

Ample data from prior trials suggest ampreloxetine's potential to address a rare, debilitating condition with no FDA-approved treatments. If successful, this could establish Theravance in the high-margin rare disease space, complementing its respiratory franchise.

Valuation and Investment Thesis

Theravance's current valuation appears undervalued relative to its diversified revenue streams and upcoming catalysts. With a market cap of ~$1.8 billion and ~$350 million in cash, the company trades at a mere 1.9x its trailing 12-month revenue. This discount contrasts with peers like AstraZeneca or GSK, which command higher multiples despite fewer growth drivers.

Investors should note that Theravance's reliance on milestone payments and partnerships introduces execution risk. However, the Viatris deal's low commercial burden and the GSK-backed financial stability mitigate this concern.

Conclusion: A High-Potential Play in Underserved Markets

Theravance Biopharma's NMPA approval for YUPELRI represents a critical step toward monetizing its pipeline in underpenetrated markets. With immediate cash infusions, low-risk partnerships, and a late-stage pipeline targeting unmet needs, the company is well-positioned to deliver sustained growth. For investors seeking exposure to innovative therapies with clear commercial paths, Theravance's combination of financial resilience and strategic execution makes it a compelling mid-cap biotech opportunity.

Consider adding Theravance Biopharma to your watchlist ahead of the CYPRESS data readout in early 2026. For conservative investors, the near-term cash flow from YUPELRI and TRELEGY milestones provides a safety net, while bulls can bet on ampreloxetine's potential to redefine the rare disease landscape.