Zymeworks To Acquire Theravance Biopharma

Research evidence excerpt

Zymeworks To Acquire Theravance Biopharma

TD Cowen Zymeworks

Global Research June 29, 2026

75% of Yupelri profit-share cash flows are directed toward interest and principal

repayment, with the remaining 25% retained by Zymeworks until the note is repaid.

Upon repayment, 100% of the profit share will accrue to Zymeworks.

The transaction does not include an equity component.

Key Terms Of Non-Recourse Note Serviced By Yupelri Cash Flows

Source: Zymeworks

Additional Royalty Streams, Milestones, And Tax Assets Provide Incremental

Upside

Beyond Yupelri, the acquisition includes multiple additional sources of potential cash

flow:

1. A $100M Trelegy milestone expected in Q1:27 from Royalty Pharma

2. Double-digit ex-U.S. royalties on Yupelri and additional sales milestones

3. Up to ~20% royalties on Vibativ sales

4. ~$2.5B in Irish tax havens, which could meaningfully enhance future cash

efficiency

Zymeworks will also have the option to evaluate Theravance’s R&D portfolio and

explore monetization opportunities for certain assets, including ampreloxetine, with

economics shared between Zymeworks and prior Theravance shareholders.

Transaction Also Includes Organizational Changes And Capital Allocation

Framework

Theravance (TBPH, $17.63, Suspended, covered by Marc Frahm) has previously

announced restructuring initiatives, including ~50-60% reductions in R&D and G&A

expenses, which are expected to continue through closing. Zymeworks will evaluate

additional alignment of resources post-close.

Zymeworks also stated the transaction does not impact its planned 2026 R&D

investments and confirmed continuation of its previously announced $125M share

repurchase program. Thus far as of June 29th, the company has purchased 1.4M

shares for $35.4M.

2 TDSecurities.com