Theravance Biopharma shares slide 34% premarket on news to cut 75% of workforce in strategic overhaul

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Theravance Biopharma Inc. shares TBPH, +3.64% slid 34% in premarket trade Wednesday, after the company announced a major overhaul of its business including reducing its headcount by about 75%, or 270 jobs. The company is also cutting two long-term directors from its board and will focus its R&D effort on its core respiratory assets. The changes come after a review of the business led by the board and management with the help of outside advisers. The stock fell more than 30% in a day in August after it announced that a trial of a treatment of ulcerative colitis missed its primary endpoint. The company is expecting the actions to lead to annualized savings of about $165 million in 2022, versus updated 2021 guidance, and to make it cash flow positive starting in the second half of 2022. The company will focus its efforts on several approved medicines for COPD and asthma. It expects sales of trelegy, a respiratory medicine developed with Glaxo, to peak at about $3 billion annually. It expects yupelri, a product commercialized in partnership with Viatris Inc. to peak at more than $400 million in annual sales. "Given the recent results from our late-stage development programs, we have made the difficult but necessary decision to focus our resources on our most promising respiratory programs and reduce the size of the organization," Chief Executive Rick E Winningham said in a statement. Shares have fallen 55% in the year to date, while the SPDR S&P Biotech ETF XBI, +1.44% has fallen 8% and the S&P 500 SPX, -0.91% has gained 18%.