UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

Current Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event Reported):  January 14, 2010

THERAVANCE, INC.

(Exact Name of Registrant as Specified in its Charter)

901 Gateway Boulevard
South San Francisco, California 94080
(650) 808-6000
(Addresses, including zip code, and telephone numbers, including area code, of principal executive offices)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o            Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o            Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o            Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o            Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 7.01 Regulation FD Disclosure.

The information contained in this Current Report (including the exhibits) is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section.  The information in this Current Report (including the exhibits) shall not be incorporated by reference in any filing under the Exchange Act or the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.

On January 14, 2010, Rick E Winningham, Theravance’s Chief Executive Officer, presented at the 28th Annual J.P. Morgan Healthcare Conference, in San Francisco, CA.  Rick E Winningham and Michael W. Aguiar, Theravance’s Senior Vice President and Chief Financial Officer, conducted a Q&A session after the presentation.  A copy of the transcript of the presentation and Q&A session are attached hereto as Exhibit 99.1 and Exhibit 99.2 and are incorporated herein by reference.

Copies of the slides shown at this presentation were furnished via Form 8-K dated January 14, 2010.

Item 9.01 Financial Statements and Exhibits.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

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EXHIBIT INDEX

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Exhibit 99.1

Theravance, Inc.

Theravance, Inc. presentation delivered at the 28th Annual J.P. Morgan Healthcare Conference on January 14, 2010.

Jessica Fye of JP Morgan:  Good morning everyone. I’m Jessica Fye on the pharmaceuticals team here at JP Morgan. We’re very pleased to be hosting Theravance at the conference this morning and now I’ll turn it over to Rick Winningham, the CEO.

Rick Winningham of Theravance:  Thank you very much and I’d like to thank JP Morgan for inviting us here to present this morning and I’d like to thank the pianist for the jazz introduction. So, with that I will get started and cover, really talk about our key programs. I’ll be providing some updates on VIBATIV™ today, which is our first product that was discovered at the company, developed by the company, taken to regulatory approval in the US and now is launched in the US and will be launched in Canada in 2010 with our partner Astellas. We’ve also, in the fourth quarter of the year, initiated the Horizon program, the Phase 3 program in COPD with GSK. I’ll be providing some updates on that program today. I’ll also be coming back in providing an update on our nosocomial pneumonia application with telavancin and then also touch on the diverse product pipeline that we have behind the lead programs. VIBATIV™ launched in the United States. It’s terrifically exciting for us. It’s the first lipoglycopeptide and only lipoglycopeptide on the market to treat complicated skin and skin structure infections from susceptible Gram-positive organisms specifically methicillin-resistant Staph aureus. VIBATIV™’s dual mechanism of action affecting both the cell wall as well as the cell membrane confer on it a bactericidal activity. That is a feature that physicians like. It’s a once-daily injectable antibiotic and again is approved for adults and launched in the US. What we’ve seen happen over the last few years in the resistant Gram-positive market is really consistent, strong growth in the number of treatment days, again, driven by increases in prevalence of methicillin-resistant Staph aureus. About 34 to 35 million treatment days over the period noted on the slide ending in June 2009, 12 months and about a third of those treatment days are due to complicated skin and skin structure infections and that’s due to the progression of community-acquired methicillin-resistant Staph aureus in the United States. Emerging drug resistance is a problem. It’s widely seen in hospitals and while resistance is not only present, there’s also reduced susceptibility to the agents that are currently being used to treat complicated skin and skin structure infections. So, that’s where the opportunity lies for VIBATIV™ in the United States. VIBATIV™ targets the septum of the methicillin-resistant Staph aureus organism and does so much more efficiently than vancomycin. You can see in these two slides, the picture’s worth a thousand words. The bright line in the middle of the cell on the

VIBATIV™ photo is really where VIBATIV™ is concentrated when it is killing the cell, really all along the septum. Whereas vancomycin, you really see only 3 bright points in the cell and that’s where vancomycin is exerting its activity and in fact, that directly translates into the potency of VIBATIV™ being more potent than vancomycin as well as being bactericidal. VIBATIV™ is part of the partnership that we have with the Astellas, a global pharmaceutical company headquartered in Japan. Our relationship with Astellas covers the development, manufacture and global commercialization of VIBATIV™ and we’ve really sought to combine the global infrastructure of Astellas with the experience that Theravance has with VIBATIV™. We will collaborate with them on the marketing for the first 3 years post launch but Astellas is responsible for all other development, regulatory, manufacturing and sales activity as well as being responsible for regulatory activities outside the United States. It is still Theravance’s responsibility to get the nosocomial pneumonia indication in the United States and I’ll come back to that towards the end of the presentation. We’ve had strong deal economics. We’ve earned over $191 million to date in milestones from Astellas related to the development of telavancin and again, Astellas is responsible for all future commercialization costs. We’ve got about $30 million of milestones that we can earn, 15 million of that is related to approval of complicated skin in Europe and that filing is in and under review and about 10 million of the 30 million is related to approval of nosocomial pneumonia in the United States. The royalties that Theravance receives from this collaboration began in the high teens. The sales evolution basis relatively quickly step out of the high teens to another level and then for global sales over $500 million, the royalty rate moves into the high 20’s. So, we’re very excited about the launch of VIBATIV™. The reception from physicians in the US, thus far, about 9 weeks into the launch has been good. Clearly, the infection in methicillin-resistant Staph aureus is on everybody’s mind. So, we look forward to providing further updates on the launch as we work through the rest of the year. Now, I turn to Horizon. This is the large program that we have with GSK seeking to develop a once-daily long-acting beta-agonist combined with a once-daily inhaled corticosteroid targeted being the next generation medicine to their drug Advair which is currently selling about $8 billion. In the future, we and GSK will refer to the combination once-daily long-acting beta-agonist combined with a once-daily inhaled corticosteroid as Relovair™. That’s the brand that we’re seeking to put on this combination product, and again it’s targeted to be the next generation combination product for asthma and COPD. A reminder again, Advair currently sells about $8 billion annually and of that $8 billion about 50% of it is in chronic obstructive pulmonary disease and about 50% of it is in asthma. We’ve initiated the Phase 3 program in COPD with GSK in 2009 and the initiation of that program comes really based on the data of an extensive Phase 2b program comprising about 3,000 patients with both COPD and asthma. We’re committed to the progression of Relovair™ in the study of asthma and beginning the Phase 3 program. We’ll give an update on that on the next slide. Why is this important to Theravance? This program is important to Theravance because we

have no cost obligation on this program up to NDA/MAA approval and launch, and we received royalties of 15% on the first $3 billion of annual sales and 5% on sales greater than $3 billion. So, this is a significant value driver for us. We are terrifically excited about the combination product that’s in Phase 3. The overall development status for Relovair™ and in this 2 x 2 matrix tries to simplify it. If you look at the first column in chronic obstructive pulmonary disease, that Phase 3 program has been initiated to satisfy both US and European regulatory requirements. You move over to the second column in asthma, the 2b is completed. We’re ongoing discussions with FDA and we’ve reached regulatory agreement with Europe. GSK is targeting to file the NDA and MAA in these indications in late 2011. So, we’re in early 2010 now. We expect a good solid progression through the Phase 3 program with the filing targeted in late 2011 in both Europe and the United States. If you step back and look at our Phase 3 program that’s currently underway and it was started in October of 2009, the goal of this program is to evaluate the efficacy and the safety of the combination of the long-acting beta-agonist in the inhaled corticosteroid. Overall, the Phase 3a program will study over 6,000 patients and is comprised of five pivotal Phase 3 studies, two 12-month exacerbation studies comprising about 3,000 patients and two 6-month efficacy studies of about 2,200 patients. The doses that we took forward into Phase 3 in the combination product with a 25 mcg dose of ‘444, the long-acting beta-agonist and we have combined that long-acting beta-agonist with either 50 mcg of the once-a-day steroid, 100 mcg of the once- a-day steroid or 200 mcg of the once-a-day steroid. Additional studies in the 3b program will be initiated to assess the potential for superiority of the fixed combination versus other treatments in COPD and look forward to brining you updates on that through the remainder of the year. Now, I’ll turn to telavancin and talk briefly about where we are with our nosocomial pneumonia application. We received a complete response letter in November of 2009 from the FDA. As a reminder, I’ve said earlier the MAA for both nosocomial pneumonia and complicated skin and skin structure infections is under review currently by the EMEA. The complete response letter listed a few key issues. They asked us to submit additional data and analysis on our nosocomial pneumonia patient population to support in evaluation of all-cause mortality as the primary efficacy endpoint. Now, there’s been a number of discussions and a variety of regulatory forum about the move from establishing clinical cure as what would be the judge for efficacy in this particular patient population to mortality. There has not been any formal guidance that’s been issued by FDA on what to use to evaluate nosocomial pneumonia. Our studies which were initiated in early 2005 and represent the largest overall study of nosocomial pneumonia in Gram-positive organisms, we used clinical cure as the efficacy endpoint. That is consistent with the existing draft guidance of FDA in the study of nosocomial pneumonia but the FDA asked for and we will submit the additional data that we have collected on mortality and I will, in the next couple of slides, go into the summary of what that data is. They also asked for further rationale on the pooling of the two studies that we have conducted as a part of the nosocomial pneumonia program. Those two

studies, Study 15 and Study 19, were each about 750 patients and the 750 patients to be evaluated at endpoint of all-cause mortality, those studies are really of insufficient power and size. So, in order to evaluate all-cause mortality, one needs to combine the studies to get to a study size of somewhere in between an analysis set of somewhere between 1,200 and 1,500 patients to provide adequate power to analyze all-cause mortality, if the FDA notes that the additional data we submit and the analyses and the plans as well as a rationale for pooling, which I’ll go over with you in just a moment, you know, if they consider those that are insufficient, they disagree with our pooling or data is insufficient, they could require us to do another study or they could require additional evidence of safety and efficacy prior to the approval of the nosocomial pneumonia indication. The additional mortality data and analyses support the prior conclusions that we have communicated on mortality with telavancin in nosocomial pneumonia and that is that there’s no difference when you compare vancomycin to telavancin in the study of these very sick patients with nosocomial pneumonia. So very briefly, I’ll go through the rationale for pooling of the ATTAIN studies. The ATTAIN studies 15 and 19, these protocols were identical and they were conducted contemporaneously over the same time period. The statistical analysis plan that we submitted to the FDA before unblinding the studies called for combining the studies for an analysis of an efficacy endpoint, albeit not mortality, but evaluating the efficacy in the population of methicillin-resistant Staph aureus infections that were within the study. There is no significant difference in treatment groups of the pooled database in 30 of 31 characteristics. So, between the studies, the baseline characteristics are the same in 30 of 31 baseline characteristics. Again, indicating these studies are very similar and should enable them to be pooled to evaluate an efficacy endpoint. In each study, the crude mortality rates overlap with on another. So, the mortality rates themselves in Study 15 and Study 19 are not different. There was no evidence in our analysis of differential informative censoring of the data. What I’ll show you in just a second are some Kaplan-Meier analyses and there is no difference in censoring between the telavancin arm and the vancomycin arm in these studies. A multivariate regression that we were able to do because of the size of the study indicated multiple baseline variables that are related to vital status and if you adjust for the prognostic factors, there was no statistically significant difference between study and treatment for mortality. The p value is 0.72. This really represents the core of the rationale that we will submit to the FDA in support of the pooling of the studies to evaluate mortality as the efficacy endpoint in the study. So, what are those? I’m going to go over two slides. This is the as-treated population, estimated survival at 28 days and there’s a lot of numbers on the slide and I’ll draw your attention to the key numbers. Because the studies are individually inadequately powered, if you combine and pool the studies together and you’ll look at the difference here in mortality between the two studies, it’s estimated at 28 days to be about 2% difference with the confidence interval ranging from -0.067 to 0.018. The confidence interval includes 0 and the lower bound of the confidence interval is in fact greater than -10 which may

be, may be the non-inferiority margin that the FDA is looking for and the reason that I say “may” is that we’ve had no communication from the FDA on what non-inferiority margin they are expecting to see in mortality studies. I’ve also included the hazard ratio in these studies, which again the confidence interval includes 0 for the hazard ratio and the upper bound of the confidence interval in the hazard ratio is in fact below the 10% non-inferiority margin. So, there is no statistically significant difference in the 28-day survival between the treatment groups in either study or in the combined Kaplan-Meier survival analysis. I would say that there is no other drug today that has been evaluated for mortality in nosocomial pneumonia. So, this is an analysis that has not been done before in this particular patient population. Now, one of the populations that I believe the FDA is interested in is a slightly more specific population within our study and that population conforms to a 2005 guidance from The American Thoracic Society and The Infectious Disease of America, which creates a slightly greater level of specificity for the identification of pneumonia. We did, as a sensitivity analysis to the overall data, a set of analyses on this particular population, which is chest x-ray that indicates pneumonia as well as two other features and if you look at the combined, again, analysis set in this particular analysis set, you see the sensitivity analysis confirms in fact the as-treated population where you get, in fact, narrower with the more specific set, you get a narrower range in the confidence interval, a narrower range around the hazard ratio. So again, with the sensitivity analysis and a slightly more specific definition of pneumonia than what was used in our as-treated population you reach the same conclusion that you do with the as-treated population. So with that, what we expect to do is to submit the response to the Complete Response to the FDA, hear back from the FDA on the adequacy of the Complete Response and just go from there forward in the review the process. Again, I’d like to remind everyone that the ATTAIN studies were conducted under the current draft guidance of FDA, which draft guidance indicates that one should use clinical cure as the primary efficacy endpoint and our studies showed in both the all-treated and the clinically valuable population, that in fact the studies were non-inferior. And so with that, I’ll turn to just a brief update on the rest of the pipeline before I go into a quick financial summary as well as some operating milestones for Theravance for 2010. I draw your attention to the third bar here on this slide because I’ve talked about the Relovair™ COPD and asthma program earlier in the presentation. We have a program with GSK that contains a set of molecules that are both muscarinic antagonist and beta agonist and we hope to be able to put that program into a large Phase 2b study this year with GSK. This program has completed Phase 2a, showed good data versus the combination of salmeterol and tiotropium gold standard therapy for COPD as bronchodilators and now hopefully we will advance this program into 2b with GSK. In bacterial infections, I’d covered the telavancin nosocomial pneumonia program, TD-1792 is another antibiotic that we have that’s completed a 200-patient proof-of-concept study, demonstrated proof-of-concept in the treatment of resistant Gram-positive organisms. We’re currently doing another Phase 1 study with that drug

to evaluate the penetration of the drug into the lung because this drug may be another effective tool as long it penetrates into the lung in sufficient quantities for the treatment of resistant Gram-positive nosocomial pneumonia. Turning to our GI programs, TD-5108 in the GI motility dysfunction area, again, this is a program where we’ve completed a 400-patient study in chronic constipation. This has been presented to The American Society of Gastroenterology showing a very strong efficacy with 5108 in completely relieving the constipation of these patients. In fact, returning their bowel function to normal. Right now, we are prepared to take this into a Phase 3 and we’re currently working on potential partnerships with this compound with other parties to potentially take this into Phase 3 because it is a Phase 3-ready asset. In addition in the GI area, our peripheral mu antagonist program for opioid-induced bowel dysfunction. That’s another program, another compound discovered at Theravance. This is an excellent peripheral mu antagonist. It’s in multiple-ascending dose studies right now and we believe that we can get proof-of-concept data on this particular compound before the end of the year. And then finally, in the area of cognitive disorders, if you look at 5-HT4 agonist like 5108, 5-HT4 agonist work in the GI tract because they stimulate the acetylcholine and the stimulation of acetylcholine on the GI tract is what causes the prokinetic activity that relieves the chronic constipation that some individuals have. If you stimulate the release of acetylcholine in the brain, it can have an effect of increasing cognition and we presented the paper on animal models on these at a neuroscience meeting in the fourth quarter. So, one of the other approaches that we’re taking with our 5-HT4 program is to in fact evaluate the potential of our 5-HT4 agonist to get into the cerebral spinal fluid and if these agents can get into the cerebral spinal fluid, there may be an application for these drugs in the treatment of Alzheimer’s disease. So, that’s an overall summary of our pipeline. It’s likely that we will take another drug out of our discovery efforts into Phase 1 this year from our pain program. Financial position, we ended the third quarter with about $154 million in cash and then immediately after that, earned a $20 million milestone from Astellas for the approval of VIBATIV™ for skin as well as the transfer of inventory. If you look at our guidance for 2009 and spending, our guidance has been somewhere between $87 million and $90 million of spending and we’ll talk about what our year end cash position is during the call that we have in early February when we review our year-end numbers. Our projected 2010 expenses and these are expenses, these are not cash burn numbers, are between $90 million and $95 million in expenses. If you look up, you know, roughly the cash burn rate for 2010, it would be significantly below this number because of milestones that we’ve received and of course our plan is, in fact, to prosecute the nosocomial pneumonia application through approval, hopefully, in the United States to earn the milestones there from Astellas as well as, hopefully, in either late 2010 or sometime in 2011 receive a milestone for approval in Europe, which is $15 million. As a reminder, GSK pays for all the Relovair™ Phase 3 expenses and they also pay for all of the MABA 2b expenses and then we have royalties we will be expecting from the sales of VIBATIV™.

Operating milestones include initiation of Phase 3 in asthma in the Relovair™ program, initiation of the 2b program with GSK in COPD for MABA, muscarinic antagonist-beta agonist, FDA approval for telavancin in nosocomial pneumonia and following that hopefully a launch in the United States and finally the 2010 milestone of proof-of-concept results out of our peripheral mu antagonist. I’d like to thank everyone for joining me today for this update in 2010. 2010 will prove to be a terrifically exciting year for Theravance and we’re looking forward to it. So, thank you very much.

Exhibit 99.2

Theravance, Inc. (Q&A)

Theravance, Inc. presentation delivered at the 28th Annual J.P. Morgan Healthcare Conference on January 14, 2010.

JP Morgan Representative:  So again, welcome everyone to the breakout for Theravance.  I don’t know if anyone has any questions… Maybe I’ll kick it off.  I guess, Relovair™ in asthma, any comments on what the focus of the talks with the FDA has been for starting Phase 3 and it is also how important do you think it is that you have the agreement in place now with the EU about the clinical path forward in asthma.

Rick Winningham of Theravance:  So how do I view this? Well, I think, you know, GSK is waiting for feedback from regulatory authorities in the United States. I view the positive feedback and agreement from the regulatory agency in Europe as being very important, because if you take the 2x2 matrix that I have shown on the slide, you can more or less and use Europe, just as a proxy for non-U.S., basically, you can allocate the respiratory market 25% in each of those boxes. So, if you look at where we have reached regulatory agreement or in fact, have initiated the studies, 50% of market’s done, that’s in COPD and those Phase 3 programs are on their way and the U.S. or the Europeans have agreed, that’s another 25% of the market as a proxy for the non-U.S. market. So 75% of, we have covered, and I think that’s quite significant. And I also think it’s quite significant that, you know, we’re communicating, that we’re planning on, GSK’s planning on filing the NDA and the MAA in late 2011. So we hope to get agreement or acquiescence from the FDA regulatory authorities, but, you know, the non-U.S. asthma portion of the market is quite important and quite large. So Mike, do you want to add to that?

Michael Aguiar of Theravance:  Sure. I think I just like to add why this is so important to Theravance goes right back to what Rick talked about in terms of how our royalties are structured coming from GSK and by that, I mean, we make a majority of royalty revenues on the first $3 billion of sales where they’re being compensated to 15%. Everything beyond that comes in a 5%, so what that means with Theravance is that, the first indication is the most important of the two, and again COPD is a very large indication today. It accounts for about 50% of Advair revenues. And as a result, that indication all by itself could potentially take us all the way through the 15% royalty range, so we are extremely optimistic about this program. I think GSK is extremely optimistic about this program. COPD is underway right now and at some point, you know, we will either get to regulatory concurrence with the U.S. on the asthma program or, you know, potentially, could go ahead and then initiate programs for the rest of the world as well. So, I think

we’re feeling extremely good about where we are today with the program in general.

Rick Winningham of Theravance:  - Yeah.

Q&A from Audience:  What are the natural successors to Advair and you think, that in a lot of places, is it just going to replace Advair?

Rick Winningham of Theravance:  Yes. I think Relovair™— I think that’s what the target is, the natural successor to Advair. The— and I think, based on, you know, the 3,000 patients that were studied in the Phase 2b program, we’re quite optimistic about this combination, not only being a once-a-day drug, but whereas Advair is a twice-a-day drug.  But as it was indicated in the calls around the time that we release data, its secondary endpoints with the 2b program are extraordinarily encouraging and those are, time to peak bronchodilation, the absolute level of peak bronchodilation of the long-acting beta-agonist, the area under the curve, i.e. the amount of the airways were opened over a 24-hour period. These were all very encouraging about positioning this drug with data as a better medicine than Advair, so that’s clearly what we’re shooting for and, you know, I think if you go back to the 2b data, the dose that we have taken into Phase 3 in COPD, it’s 25 microgram dose. That 25 microgram dose had stellar results in efficacy. It was not the lowest dose that showed statistically significant efficacy, but really because of some of the secondary endpoints that we looked at, that was the dose that we chose to combine with the steroid in the COPD program, and I think we’re quite optimistic about it. And the adverse events profile are very good, Mike.

Michael Aguiar of Theravance:  Yeah. Let me just make a comment on the adverse event profile, because this is an area I think everybody knows the FDA is quite focused on, is making sure the drugs today are safe. And we saw in particular, with the beta-agonist portion of this combination as we’re going through our Phase 2b studies, a very, very favorable safety profile and in fact, if you are to look at the overall rate of adverse events in both the 600-patient study with compound ‘444 in asthmatics, as well as the 600-patient study with compound ‘444 in patients with COPD, you actually had a lower incidence of adverse events on drug than on placebo. So, in addition to what Rick was talking about, which is, is really terrific efficacy profile, to date the safety profile of compound ‘444, the beta-agonist portion of this combination medicine looks very, very encouraging so it is really the combination of great safety and great efficacy that we think has the ability for this drug to be a better medication than what’s on the market today.

Q&A from Audience:  Does GSK control the timeline for the development going forward and who has control over the marketing?

Rick Winningham of Theravance:  The Collaboration, and we have been on this collaboration with GSK since 2002, is managed through a joint governance committee, both GSK and

Theravance personnel. The actual work on the ground and in the clinic is done by GSK and paid for by GSK. But, you know, I think if you look back over time, this is— to date has been an incredible commitment of resources behind this program when you just think about 3,000 patient Phase 2b program that we completed prior to entering in the Phase 3, and now you’re looking at a 6,000 patient 3a program for registration of COPD where as our objective here as to not only get an efficacy claim at launch with improved FEV1, but our objective is to get an exacerbation reduction claim at launch, so that we can launch with both improved efficacy reduction in COPD exacerbations, allowing us to position the drug very strongly in the market, the combination product very strongly in the market. So, you know, GSK is doing the work, it’s governed by a joint steering committee, and I think the sort of the proof is in the pudding on the size of the study and the overall level of commitment historically and it is ongoing right now.

Q&A from Audience:  I viewed someone answered this.  Curious how you view the landscape different based on whether there is generic Advair or not, right now obviously why it is so much better version of the drug, but I’m curious if you think there will be generic Advair and the managed care [inaudible] get generic Advair and [inaudible] doesn’t change the [inaudible] so well [inaudible].

Rick Winningham of Theravance:  Yeah. You know, I think the discussion on generic Advair is probably better left to GSK, you know, this is a very big market. Generic and inhaled generic drugs are very difficult to develop for obvious reasons so it requires a certain technical competence and inhalation drug delivery to develop a generic-inhaled medicine, and I think that poses certain challenges but you know, I probably direct you to GSK on the specifics of the generics. I think the objective here has always been to develop a better medicine, and we know one parameter of that is dosing, a once-a-day dosing and the other parameters are around efficacy and safety, you know, just— a side bar, if you go back and look at the adverse event profile in the 2b program and you look at the dose in Phase 3 with 25 micrograms of the LABA. If you double the dose of 25 to 50 micrograms of the LABA, you know, there was no change in adverse effect on heart rate, so these drugs were, you know, the LABA’s that we have evaluated and now the one that we are evaluating in Phase 3 were all designed to be better among different parameters than the long-acting beta-agonist that is currently in Advair. And likewise, with the corticosteroids so, I think, just based on 3,000 patients, we’re optimistic that we can compete quite effectively, sort of regardless of the environment.

Q&A from Audience:  Can you also address the competitive landscape, like with Novartis and any insights on how the competitive landscape looks assuming everybody gets approved eventually [inaudible]?

Michael Aguiar of Theravance:  Yeah. Let me just say quickly. Well, I don’t want to get into a

timeline on generics, but I think we certainly have a view that at the end of day, a better medication is going to win and we clearly think we have a better medication. Now, specifically to your question with regard to the competitive landscape, there is really one company that we pay a lot of attention to and that is Novartis. As most of you know, Novartis has, what looks like a pretty good compound, indacaterol. It has recently been filed in the United States for the treatment of COPD. They received a Complete Response Letter back from the FDA on that. They also are looking to combine the compounds, so that the NDA they submitted for single-agent beta-agonist in COPD. They also have combinations with both an inhaled corticosteroid and anti-muscarinic antagonist similar to what we’re doing with GSK. Combination medications are going to be the bigger sellers in the future, so my suspicion is that they’re eventually going to get to the market with combination medications. My suspicions, we’ll eventually get to the market and they are clearly a very good competitor. The data that I have seen looks pretty good and Novartis is a pretty good company. Now that being said, I really like our position a lot. I like our data a lot and I think we’re going to be quite competitive, so that is the one company that I pay a lot of attention to with regard to, you know, competitive environment.

Rick Winningham of Theravance:  And I think when once again— when one’s looking at this relative to Theravance, it is always important to consider the royalty structure for us, which is, you know, 3 billion dollars, first 3 billion dollars of global sales, we are in 15% and sales over 3 billion dollars, we are on 5%, so we’re, you know, we’re quite motivated in that first year.

Q&A from Audience:  In the presentation, are these studies being done in the Gemini device, the next-generation device?

Rick Winningham of Theravance:  Yeah. They’re being done in the next-generation device. It’s the same device that we was used in the 3,000 patient 2b program as well as of variety of other Phase 3 enabling studies along the way.

Michael Aguiar of Theravance:  Yes. So just to be clear, as you think about this medication, it is a brand new device and a brand new formulation with brand new agents so you have brand new composition of matter, brand new formulation, brand new device patent, so this is a well-protected product. It is novel in all aspects, and these aspects were used in the Phase 2b studies as well, so it’s not like we’re running into Phase 3 with brand new stuff. So, you know, think about this is having full patent life in front of it.

Q&A from Audience:  As you had point to concur the [inaudible] after build to the chart for the respiratory indication.

Rick Winningham of Theravance:  Well for COPD, I think the efficacy is FEV1, you know, increasing FEV1 versus placebo. That’s the standard for chronic obstructive pulmonary disease

approval for efficacy. Now, we are— we are also simultaneously running the efficacy and safety studies where GSK is running the two 12-month exacerbation studies such that we can launch with both an efficacy claim as well as an exacerbation claim. And it’s important to note that the structure of that exacerbation study is essentially a four-arm study with the long-acting beta-agonist ‘444 compared to the combination of the long-acting beta-agonist plus one of three doses of the steroids, so if you’re going into that study, you have the chance of either being on the long-acting beta-agonist or one of the three combination products, those are your only choices. So what we’re trying to show obviously in that study is that the addition of the inhaled corticosteroid reduces the rate of exacerbations relative to the single-agent alone.

Q&A from Audience:  How much is the reduction of exacerbation to retreat [inaudible]?

Rick Winningham of Theravance:  Well I think, if you look at the historical reduction exacerbations in COPD, just go to the Advair label. They lined-up pretty well with increases in FEV1, you know, increases in FEV1 not terribly surprisingly, lead to a reduction in exacerbations.

Q&A from Audience:  I have a little bit of a basic question. How is the market opportunity for telavancin change given the delays in that product has change in their view up down in a year.

Rick Winningham of Theravance:  Well, the resistant Gram-positive market today is a lot bigger than it was four years ago. You know, we used to talk about 24, 25 million treatment days in the United States. Today, it’s 34 million treatment days. We used to talk about, you know, if Mike can help on this similar 25% or so of the market being complicated skin. Now, you know, it’s 33% to 34% complicated skin.  In pricing, you know, pricing has continued to hold up quite well for the branded agents and it’s not surprising because the reason these agents were being used whether it’s linezolid or daptomycin or— and those are the primary agents used for methicillin-resistant Staph aureus that are branded. It’s because the rising MICs to vancomycin, and you know, once you get into a situation in an institution where predominance of your organisms have MICs equal to or greater than one. For vancomycin, you’ve got a pretty high probability of treatment failure and the number of those institutions where you see that type of epidemiology is increasing, so this is sort of a continuation of a theme that’s been underway in a trend since the mid-1990’s with methicillin-resistant Staph aureus. Mike, you want to—

Michael Aguiar of Theravance:  Yeah. I think Rick hit on the couple of the key points as one other key point that he missed on, and I’ll talk about that in two contexts and that is if we are to go back about two years ago at the time there were five compounds that were going into the skin indication. There is telavancin and plus four others, and today those other four compounds for various reasons have stumbled, you know, in particular, the review division for Anti-Infective is a pretty deliberate review division and they do a pretty thorough job in terms of that. And so there are fewer compounds today in the complicated skin space than we had anticipated in addition to

the entire market growing substantially. As Rick mentioned, it used to be about a quarter of the market, today about a third of the market is related to skin infections, so you have a larger market with a slowly increasing— increases in MIC rate for vancomycin and fewer treatment agents than what we thought would be there a couple of years ago. So I think today from a skin perspective, it is a much a larger market. For the, nosocomial pneumonia perspective, the market is roughly the same percentage of a growing market, so it is still about 20% on the market, which related to lower respiratory tract infections that are related to resistant Gram-positive infections of those about half of them are nosocomial pneumonia, about half of those are community-acquired pneumonia. And then in the nosocomial space, you know, we obviously have our application in front of the FDA. You know, the challenge today is the endpoints are still a little bit unclear from the FDA on how exactly this is going to get approved. That being said, we have done a study, a series of studies here, they were about three to four times larger than the most recent studies that were used for approval for linezolid. So, we have a very large data set today but there’s a little bit of uncertainty around where the goal post is ultimately going to be set with the FDA.

Q&A from Audience:  Do you have any sense of when the clarity for that will come?

Michael Aguiar of Theravance:  Well, I think that we’ve continued to believe that should our Response to the Complete Response be accepted by the FDA, that we will then have our application taken to an advisory committee. And it’s pretty likely that that would be a forum where you would have some pretty good discussion about what potential endpoints will ultimately be for the conduct of these studies. So, that’s a possible path of where these guidelines could be set would be our application and in front of the advisory committee and so, you know, just a couple of things that I’d like to cover on that with regard, as I mentioned, we did the largest series of studies that have been done to date. As Rick mentioned earlier, each of these studies about 750 patients in total and these studies met their primary endpoint of clinical cure. Now if you were to look at this from a mortality perspective, which is where the FDA potentially is going today, each of these studies individually would be a little bit on the small side to meet the size and statistical powering you need to study from a non-inferiority perspective. See you need to pool these studies. We think we have a pretty good rationale for pooling, you know, that being said, the FDA can always come back and say they disagree with the rationale. That’s a possibility. They could come back and say we’ll, you know, we agree with your rationale, but when you pool them, that’s one study so you need to do another study so, you know, there could be some scenarios here where despite the fact that these are extremely large studies, the FDA could come back and say, you know, we disagree with that, go back and do some more studies. All that being said, I think we feel pretty comfortable where we are today given this uncertainty, but again, the FDA has the final say on this and today I don’t know what the answer is. Rick, did I mention— did I miss anything on that?

Rick Winningham of Theravance:  I think you’ve covered it perfectly. And you know, for people that have followed this area for a while, you know, it’s striking— it’s striking to me when we initiated these studies, the size of the program 1,500 patients,  in two 750 patients studies, and if the FDA and the Anti-Infective division specifically has never looked at, randomized, double-blind studies of this size before to evaluate clinical cure or mortality. And, you know, I — sort of piggy back on what Mike has said and therefore, the community broadly really has never had the ability in a double-blind, randomized setting to understand what it is that contributes to mortality in patients with nosocomial pneumonia. I think we have a very specific understanding now, because of our identically protocoled, double-blind, randomized studies and the proportional hazard ratio— proportional hazard analysis we can do what in fact contributes to mortality? And you know, I am eager actually to get in front of an advisory committee, because I think as Mike said, I think the FDA has an opportunity to use this program to enable them to set standards for the approval of drugs for nosocomial pneumonia, and this is important because greater certainty needs to be there for future investment in nosocomial pneumonia trials, and, you know, the organism, methicillin-resistant Staph aureus is in fact a baseline characteristic that portends for higher death in our studies and their needs to be—, they probably over time additional treatments developed for this infection, and I think telavancin has an opportunity to really be a useful addition and clearly in the armamentarium for treating Gram-positive infections and circling back to the complicated skin launch. That’s why we’re all hearing from physicians as that, you know, they’re looking for additional options to treat these patients and, you know, after doing it for skin, they’re certainty looking for that in nosocomial pneumonia. Okay, if there are no further questions, we really appreciate you guys hanging in there, with us — on the Thursday of the JP Morgan conference, so thank you.