Thank you for standing by. This is the conference operator. Welcome to Zymeworks conference call and webcast to discuss the acquisition of Theravance Biopharma. As a reminder, all participants are in a listen-only mode and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. I would now like to turn the conference over to Shrinal Inamdar, Vice President of Investor Relations. Shrinal, please go ahead. Thank you, operator. Good afternoon, everyone, and thanks for joining. During today's call, Ken Galbraith, our Chair and CEO, will provide an overview of the strategic rationale for the proposed acquisition of Theravance Biopharma by Zymeworks, as announced via press release this morning. Scott Platshon, our Chief Business Officer, will then provide a deeper understanding of Theravance's business and the value of its underlying assets and cash flows. Lastly, Kristin Stafford, our Chief Financial Officer, will provide an overview of the key terms of the non-recourse financing with OMERS Life Sciences. Then we will open up the floor for Q&A at the end. As usual, I'd like to remind you that this call will contain forward-looking statements, including, without limitation, those forward-looking statements identified in our slides and the accompanying oral commentary. Forward-looking statements are based upon our current expectations and various assumptions and are subject to risks and uncertainties, including those associated with companies in our industry and at our stage of development. For a discussion of these risks and uncertainties, we refer you to our latest SEC filings as found on our website and as filed with the SEC. I'll now hand over to Ken. Thank you, Shrinal. Good morning or good afternoon to everyone. We're thrilled to announce our proposed acquisition of Theravance Biopharma this morning, the first concrete execution of the strategy we committed to in November 2025. We believe this transaction validates our unique business model, which combines the synergy of our operational infrastructure with a diversified portfolio of cash flows and partners. The addition of Theravance meaningfully expands our portfolio of medicines that deliver significant value to patients and shareholders. YUPELRI is a highly attractive asset that aligns well with our strategy of acquiring durable cash generative healthcare assets that deliver meaningful benefits to patients. It's the only once-daily nebulized LAMA approved for COPD maintenance in the United States, serving a distinct patient population with a differentiated clinical profile. Combined with Orange Book-listed patent protection extending to October 2039, YUPELRI offers the long-duration cash flow characteristics that we look for when deploying capital. The acquisition price of $17 per share represents a total transaction value of approximately $929 million, expected to close in the second half of 2026. Zymeworks would expect to use approximately $219 million of cash from the balance sheet to acquire Theravance, of which $100 million is expected to be recouped in the first quarter of 2027, based upon projected near-term milestone payments. An important aspect of this transaction is how we financed it. A significant portion of the consideration is funded through non-recourse financing secured solely by the acquired YUPELRI royalty cash flows rather than Zymeworks' balance sheet. Combined with the acquired cash and expected milestone receipts, this structure substantially reduces the amount of our own corporate capital required to complete the transaction, enabling us to pursue a larger multi-component acquisition while preserving financial flexibility for future capital allocation. We've secured a $350 million non-recourse financing from OMERS Life Sciences with repayments solely from YUPELRI's own cash flows. This note has no recourse to any of Zymeworks' cash or existing assets or cash flows. This enables us to complete the acquisition without issuing equity and without encumbering our broader asset base. Due to the profit-share nature of YUPELRI's collaboration with Viatris and the co-promotion rights, these are exactly the kinds of long-duration cash flows that are typically not accessible by traditional royalty players. Zymeworks' net investment in the acquired business enables us to gain access to an asset expecting to be generating around $60 million in annualized cash flows at current run rates, with potential for continued growth. The durability and predictability of the YUPELRI cash flows allowed us to finance 75% of the business value with OMERS in the form of the non-recourse note at an attractive cost of capital. This net investment in the business from Zymeworks utilizes approximately 50% of the proceeds from our Royalty Pharma note borrowed earlier this year, with the remaining 50% allocated to fund the current stock repurchase program. Importantly, the collaboration structure and economic split from YUPELRI provide meaningful participation in the future success of the asset, while the commercial infrastructure and day-to-day execution remain largely in the hands of experienced operating partner Viatris. This allows us to benefit from continued commercial performance while maintaining our disciplined operating model. While YUPELRI is the cornerstone of the transaction, it's not the only source of potential value expected to be realized by Zymeworks. The proposed acquisition also brings a potential near-term $100 million milestone payment from Royalty Pharma for 2026 TRELEGY ELLIPTA net sales expected to receive in the first quarter of 2027. 20% royalties above a threshold of up to $100 million cumulative on the VIBATIV, an important injectable antibiotic. Approximately $2.5 billion of Irish tax attributes and a pipeline of early-stage I&I assets that can be evaluated for future possible development, spin-offs, licenses, and partnerships. The multiple avenues for value creation provide potential upside opportunities for Zymeworks shareholders and are another reason this transaction is not accessible to traditional royalty buyers. This transaction combines a differentiated commercial asset, attractive financing, additional embedded value streams, and strategic assets that provide the opportunity to contribute to long-term shareholder returns. Most importantly, this is a transaction when closed, that fits squarely within the capabilities we've built as an organization. In a base case, we anticipate a mid-teen IRR over the long term, and we expect YUPELRI to start providing immediate returns on our investment after closing the transaction. Today's proposed transaction, once closed, will meaningfully diversify and expand our partnered portfolio beyond Ziihera and pasritamig. As a reminder, we remain highly confident in the regulatory review for zanidatamab in first-line GEA with a regulatory decision expected on or before the PDUFA date of August 25, 2026. If approval is received as expected, this will result in a $250 million milestone payment from [inaudible] Pharmaceuticals. This near-term milestone will strengthen the balance sheet and provide means to continue to fund future stock purchases beyond the current approved plan, as well as consider further acquisitions and other opportunities after closing of the proposed Theravance transaction. Funding of current R&D priorities at Zyme for 2026 are unaffected by this transaction. This transaction, therefore, aims to diversify revenue sources and increase visibility on a diversified recurring revenue base on top of our established partnerships, such as those with Jazz, BeiGene, and J&J. We believe this proposed transaction is consistent with Zymeworks' disciplined and thoughtful capital allocation framework, prioritizing assets that can generate near to mid-term diversified cash flows while preserving long-term opportunities for growth. Meanwhile, we've continued to deliver on our objective to further our research and development efforts in increasingly novel modalities and targets with the recent unveiling of our pan-RAS ADC platform and candidates. Our whole human pipeline continues to provide us with additional upside opportunities from value-creating catalysts such as development milestones, data readouts, partnerships, or spin-outs. With that introduction, let me hand over to the team to talk through the commercial and financial details, and first, over to you, Scott. Thanks, Ken. I'm really pleased that we've been able to move efficiently from search and evaluation efforts through to announcing such a high-quality, multi-component proposed transaction for our first acquisition, just seven months from announcing our new strategy in November 2025. COPD is a progressive lung disease and the sixth leading cause of death in the U.S. Long-acting muscarinic antagonists, or LAMAs, serve as a foundational therapy for nearly all patients with COPD. For the millions of patients who are transitioning from hospital to home care, who struggle with inhalers or have impaired inspiratory flow, who suffer from some level of cognitive decline or are just not well controlled on short-acting bronchodilators, there is only one nebulized LAMA option, YUPELRI. The continued product growth is driven by underlying demand and persistence, which speaks to the meaningful value delivered to patients and aligns with the overwhelmingly positive feedback we receive from physicians. Combined with its differentiated profile, long patent life, and foundational position in the treatment of COPD patients, we believe YUPELRI has the characteristics of an asset capable of generating very durable cash flows. As Ken mentioned, the proposed acquisition of Theravance provides Zymeworks with a 35% participation in U.S. net profits from YUPELRI. Viatris is responsible for promotion in the community while Theravance manages the hospital setting. The commercial infrastructure supporting the product is already in place. Our diligence provided clear insight into six years of impressive execution by both the Viatris and Theravance teams. In particular, it is clear the Theravance team continues to drive further growth into the hospital channel for this brand. Zymeworks intends to substantially preserve the existing hospital promotion infrastructure from Theravance's commercial organization. Taken together, this is an attractive combination of established commercial performance, long-duration exclusivity, embedded milestone opportunities, and ongoing participation in future growth. We believe this type of asset will fit exceptionally well into our model. It leverages the capabilities we've already built, provides attractive financial characteristics, and expands the range of opportunities we can pursue as we continue to grow our business. YUPELRI generated U.S. net sales of $266.6 million in 2025, representing 12% year-over-year growth. First quarter sales of 2026 were $62.4 million, representing 7% year-over-year growth. Theravance remains eligible to receive an additional $125 million in commercial milestone payments from Viatris based upon reaching certain thresholds of U.S. net sales, as well as double-digit tiered royalties and additional milestones on ex-U.S. net sales. Settlements have been reached with all YUPELRI generic filers for April 2039, subject to certain exceptions and other provisions customary for agreements of this type. The proposed acquisition also includes several additional sources of value that are independent of YUPELRI, including a near-term $100 million milestone payable by Royalty Pharma based upon GSK's 2026 net sales of TRELEGY. 2025 sales of TRELEGY were approximately $3.9 billion, and consensus 2026 forecasts exceed $4 billion. As a result, we view this milestone as highly visible and an attractive source of near-term value. The acquisition, once closed, will include additional royalty interests that further diversify the cash flow profile of the transaction, including a 20% royalty interest in VIBATIV, which continues to generate commercial revenues through its marketing partner, Cumberland. Beyond the core commercial assets, the transaction, once closed, will strengthen our existing infrastructure by adding an immunology and inflammation R&D portfolio from Theravance, which we will evaluate within the broader context of our established pipeline and capital allocation framework. These assets could selectively expand our internal development capacity or be externalized if the opportunity is attractive. Finally, following closing, this acquisition will bring ampreloxetine. A designee from Theravance will explore the opportunity to license, divest, or otherwise monetize ampreloxetine for the period through 12 months post-close, with any economics shared 20/80 between Zymeworks and Theravance shareholders. The proposed acquisition also includes very significant Irish tax attributes, which following closing, we will incorporate into our broader financial and operating structure. These attributes have the potential to very meaningfully enhance the economics of future investments and improve our capital efficiency. Individually, these assets are not the primary drivers of the acquisition rationale. Collectively, however, they contribute additional diversification and optionality. With that context, let me hand it over to Kristin to take you through the royalty back note and financials. Thank you, Scott. Since joining Zymeworks, I've had the opportunity to reconnect with colleagues in the royalty space as we've explored potential partnerships and financing opportunities. One consistent takeaway has been that there are attractive healthcare assets that don't fit neatly within the traditional royalty model. Whether due to operating complexity, tax considerations, commercial participation structures, or other factors, these opportunities often require a different ownership and financing approach. These are precisely the situations where Zymeworks' differentiated capabilities could create a competitive advantage. Our business model gives us the flexibility to evaluate a broader range of healthcare assets and structure transactions in ways that align the interests of sellers, financing partners, and shareholders alike. We've stated previously that our goal is not to compete with established royalty organizations, but to broaden our opportunity set by partnering with them. This transaction demonstrates that approach. By combining our infrastructure, which allows for the acquisition and optimization of complex healthcare assets, with OMERS' ability to provide non-recourse capital, we're able to execute transactions that neither party would have pursued in the same way independently, creating value for both organizations. I'll now walk through the transaction structure and financing in more detail. As you've heard on the call today, I want to reiterate that there's no Zymeworks equity component to this deal and thus zero shareholder dilution. A $350 million non-recourse note from OMERS Life Sciences with a coupon of 8.25% and an expected maturity date of 2036 will be used to finance the transaction. Once the note is repaid, the residual profit share reverts to Zymeworks. I want to highlight that this financing is non-recourse to any other part of Zymeworks' business. As you can see on the right-hand side of the slide, the YUPELRI net sales first flow through Viatris and then Zymeworks' 35% YUPELRI profit share is distributed. This is approximately $60 million annually at the current run rate. Upon distribution of the 35% YUPELRI profit share, OMERS' retains a 75% portion of the cash flows to service the note, first interest and then principal. The residual 25% cash flows go to Zymeworks. Once the note is repaid, all cash flows will be retained by Zymeworks. The financing also includes a declining call protection schedule as shown on the slide, providing flexibility to refinance over time while offering appropriate downside protection. The financing structure enables Zymeworks to maintain a strong balance sheet with lasting capital beyond 2028 to fund continued R&D investment, future acquisitions, and share repurchases. From a financing perspective, the headline purchase price materially overstates Zymeworks' actual capital at risk. The transaction value is approximately $929 million. That is funded through three sources, approximately $300 million of cash acquired at closing, $350 million of non-recourse royalty financing provided by OMERS, and approximately $219 million of Zymeworks' own cash on hand. Taking into account the anticipated $100 million milestone payment from Royalty Pharma related to sales of TRELEGY by GSK, Zymeworks' effective net investment is expected to be reduced by approximately 50%. The OMERS financing is self-servicing and non-recourse to Zymeworks, meaning repayment is supported directly by only the underlying YUPELRI profit share. Our current capital structure is designed around three principles, isolating risk, preserving flexibility, and protecting shareholder upside. The financing structure reflects each of these priorities by limiting our capital at risk, preserving balance sheet capacity, and optimizing long-term value creation for shareholders. Upon closing, Zymeworks intends to complete Theravance's previously announced organizational restructuring to align its resources with its commercial focus on YUPELRI, which is expected to significantly reduce R&D expenses and general and administrative costs, as well as pursue additional synergies in the cost structure of the combined entities. In addition to the proposed transaction announced today, we previously secured a $250 million non-recourse facility from Royalty Pharma, backed by Ziihera royalties. This is another source of non-dilutive capital that further supports share repurchases, strategic acquisitions, and extends our operating runway beyond 2028. As we announced in May, we have implemented a new $125 million share repurchase program for 2026. We view this as an efficient way to return capital while maintaining flexibility to continue investing for growth, and we expect to continue executing against this repurchase plan with visibility into substantial milestone payments expected related to potential near-term approval of zanidatamab globally. As of June 29th, 2026, the company has repurchased 1,437,073 million shares of common stock for $35.4 million, exclusive of commission expense and estimated excise tax, which represents an average purchase price of $24.63 per common share. Importantly, none of this comes at the expense of the pipeline. We will continue funding our clinical programs and early-stage R&D with disciplined cost management. Across every facility, our objective is the same: structure capital in a way that limits downside exposure while preserving long-term shareholder upside. With that, I will hand the call back over to Ken for closing remarks. Great. Thank you very much, Scott and Kristin. To summarize, our novel strategy is built around two complementary engines is starting to materialize with real progress on both sides. On the royalty portfolio, once the acquisition announced today is closed, we will have secured the YUPELRI profit share at what we believe is a disciplined valuation while maintaining capacity for future opportunities. On the R&D side, we have continued to make progress on our goal of advancing assets to key clinical inflection points and expect additional clinical and regulatory milestones over the coming. We look forward to providing further updates on our goal of partnering or monetizing portions of our R&D pipeline and platform capabilities in ways that can create upfront value, long-term royalties, and continued pipeline optionality. Together, acquisitions diversify the foundation for durable revenue growth through recurring cash generation while R&D raises the ceiling through innovation and future potential upside. Ultimately, success for us means helping more patients, both those who depend on important therapies available today and those still waiting for the breakthrough medicines we're working to create. What makes this opportunity particularly meaningful is that it brings together two things that matter, our mission. Helping patients today while creating resources to develop medicines for patients tomorrow. At the same time, the predictable cash flows generated by established medicines like YUPELRI can help fund the next generation of innovation at Zymeworks. We expect this transaction to close in the second half of 2026, and we look forward to updating the market as we advance towards closing and future information becomes available. With that, I'd like to now open the line for questions. Operator? Thank you. To ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. We ask that you please limit to one question. The first question will come from Yigal Nochomovitz with Citigroup. Your line's now open. Hi. Great. Thank you very much for taking the questions. Congrats on this transaction. I was just curious with respect to the time to. Oh, can they not hear me? Can you hear me? Oh, wait a minute. Yes, I can hear you. Okay, great. No, I was just asking with respect to the time to repay the debt. I think Kristin mentioned the maturity in 2036, and looking at the Theravance filings, it looks like about $75 million of that is the net profit, you're paying about $55 million back to OMERS. Given your assumptions with respect to the growth in YUPELRI, could you just talk to whether you could repay sooner than the maturity, or that's the expectation? Thanks. Yeah. I think, Yigal, I wouldn't want to comment further on some of those details. I think we feel really comfortable with the financing structure we have negotiated with OMERS. I think they're going to be a great financial partner for us for this acquisition, their faith and belief also in YUPELRI growth allowed us to do this transaction. As always, having flexibility in future financial structures is always something that's good, we've been able to negotiate a really good financing package today to allow us to do this acquisition, we have some flexibility and optionality in the future over how we might organize our capital structure. I think we have, as we said before, liked the long-duration cash flows, whether that's with Ziihera or YUPELRI, we've tried to match that, as we did with Royalty Pharma earlier, with some longer duration obligations for repayment while maintaining some protection to be able to evolve those structures earlier if the situation indicates. Okay. Thank you. Yeah. Thank you very much. Thank you. Our next question will come from Eva Verdejo with Wells Fargo. Your line's open. Hi. Good morning. Congrats on the progress and thanks for taking our question. The first one from us, how are you thinking about YUPELRI's peak sales potential in COPD? Thanks. Yeah. Thanks for the question. Again, we can't provide too many details till closing of the transaction. I don't know, Scott, do you want to talk something about what we've seen historically from this product that gives us some belief that there's good growth remaining in the long duration of YUPELRI that it has left? Yeah, absolutely. Thanks, Ken. Thanks very much for the question. We're going to be limited in what we can comment on at this point until the transaction's closed. The best way to comment about this is really the dramatic benefit for patients and the feedback we've received from physicians about YUPELRI being really a foundational treatment. We've seen really robust growth in the hospital channel, and I've been very impressed by Theravance's execution and have expectations that will continue. Beyond that, I think we'll hold off providing any additional sort of long-term guidance. Eager to take over the program pending close and drive that growth further. Got it. Thanks. Thank you. Our next question is going to come from Charles Zhu with LifeSci Capital. Your line's open. Hello. Thanks for taking the questions and congrats on this acquisition. Maybe just a follow-up here. Can you talk a little bit about some of these channel dynamics between hospital and community practices, why it seems to be so heavily weighted towards the latter as of right now? As well as how much more upside is there in the hospital channel for which you/Theravance will be responsible, and how much investment you would need to capture the value in that segment? Thank you. Yeah, great. Thanks for the question, Charles. Scott, do you want to address that with Charles? Yeah. Thanks, Charles. Appreciate the question. We have a similar observation of being really impressed by the small commercial team at Theravance. We have a high confidence that they'll be able to be retained and continue their work driving really robust growth into the hospital. I think what you're seeing there is really the dramatic value that YUPELRI offers those patients that have a need to receive their medication just with tidal breathing. These patients that are in the hospital and at risk of exacerbation and recovering really can benefit from the dramatic safety and established efficacy profile of YUPELRI, and we have received really positive diligence about the ongoing growth in the hospital. We think the structure with Viatris where they do a lot of the heavy lifting around some of the commercial org makes this very manageable infrastructure. We're really pleased with that setup and do expect that hospital growth to continue. Great. Thanks. Congrats again. Yeah. Thanks, Charles. Thank you. Our next question will come from Gregory Renza with Truist Securities. Your line's open. Hey, guys. It's Anish on for Greg. Congrats on the deal, and thanks for taking our questions. Just on YUPELRI, how are you thinking about the fit of a commercial COPD asset within Zymeworks's longer-term identity as an oncology antibody platform company? Is this the start of a broader commercial diversification strategy? Just a quick one on the deal mechanics, if I can squeeze that in. How usable are the $2.5 billion of Irish tax attributes given your current profitability profile, and how much of that did you ascribe value to in today's total deal value? Thanks so much. That's great. Anish, could you repeat that question? I just missed the first part of it, if you could. Just on YUPELRI. Yeah. I just wanted to know how you're thinking about the fit of a commercial COPD asset within Zymeworks's longer-term identity as an oncology and antibody platform company. That's great. Thanks for the question. Obviously, we have been working in COPD for a little while with our first research asset, ZW1528, and looking to put that in the clinic next year. I think as a part of that, we have been ensuring we have a sufficient understanding of the commercial marketplace for COPD as we think about where 1528 might be applicable in those patient settings. I think it's an area that we've felt that we have been working in from a research perspective and understanding the market. I think from that perspective, at least from a therapeutic category, we have been working outside of oncology for some time now. We felt we had expertise and access to other expertise to at least be able to understand this. At the same time, it was a product that's been on the market since 2019. I think we take some comfort from Viatris being the main commercial partner under the joint venture that was established some time ago with Theravance and Viatris. I think we've gotten a good understanding of co-promotion capabilities, and I think we're starting to understand at least how we can integrate that into Zymeworks and still drive the type of value that we think we can on a returns basis to reach that mid-teens IRR as this being an important part and an immediate source of returns post-closing. I'll ask Scott if he'd like to comment further on that aspect. No, I think you said it well, Ken. We really see the ability to access royalty-like economics with a very small commercial sales force while Viatris is doing a lot of the heavy lifting managing the day-to-day operations of the community part. The long duration and predictability of that cash flows in an area that we know well, given our presence with [inaudible], lets us create more capital inflows for the company that can be allocated to our innovative R&D, to additional share repurchases, and to looking at future M&A once closed. Yeah, thank you. Just to add to that, Greg, too, I think from a royalty portfolio partner, royalty portfolio aspect, we do like the eventually, since we're holding this longer duration, the diversity of cash flows. Therefore we want to pay attention to the source of those cash flows from the partner, the therapeutic category, the product modality. I think if our royalty portfolio is going to be meaningful over the long term, it can't just come from one source or just from bispecific antibodies we've created for the oncology marketplace or solid tumors. I think having some diversity does provide us with some additional thought of value that that diversity might provide. We've tried not to stray too far with, from a therapeutic area standpoint. I think we feel comfortable that in COPD we can understand how to value this asset. Generally, our other products in this portfolio are straight out royalties, and we're not participating in the commercial piece. We do like the fact that this is royalty-like but not royalty, so there could be some upside from participation in a commercial performance that's driven by having a 35% profit share versus a royalty. We also, along with that, have some co-promotion ability to drive investments as a part of reinvestment of some of that gross margin back into building the top line. It might give us a little bit more thought there may be some more upside from us in actively participating along with Viatris as a part of this. I think as long as they're able to drive the same value that this sales force has driven for Theravance, then I think there might be something more interesting upside than a royalty where we can't impact the top-line aspect or the growth of that. I think there are some parts of this that are actually positive, although they might be a little bit more diverse from where we have been versus our own sources of royalties we've created with our own partner products. Thank you. Thank you. Thanks. Our next question is going to come from Mayank Mamtani with B. Riley Securities. Your line is open. Yes. Good morning, team. Thanks for taking our questions, and congrats on the deal. Sorry if I missed this earlier. You know, specifically valuing the Irish tax attributes, and maybe just how that's unique to the Zymeworks' operating model, you know, relative to any other royalty-focused company. If you could maybe just give insight so we understand, you know, what sort of future deals you might be looking for. Just on the math here. You're shelling out net $119 million from your balance sheet to have, you know, what seems like $60 million of your proudly cash flows, like net after the OMERS note would be about $15 million. Are we thinking about this right? Lastly, on the ampreloxetine CVR, could you just give us a little bit more color on what the postmortem has been after the suppressed results and if there's any rough cost and, you know, timeline for refiling or anything that's been factored in as part of this transaction? Yeah, you always manage to get multiple questions in a one-question limit, so we'll try to address them if we can. Sorry about that, Ken. We get used to it. You're good at it. I think from our perspective, at least first point, I think you're getting this right. I mean, we've allocated about half of the financing from Royalty Pharma to allow us to do this deal, and it obviously required other financing and hedging inside Theravance to be able to do this. We think we get a multitude of assets in this transaction, which provides near-term return, but lots of optionality for us in how we utilize those assets moving forward. In acquiring the entire company as opposed to the product, we're entitled to other assets that might come along with that. Obviously in Theravance, as it's been noted, they have a pretty substantial level of Irish tax attributes, which may have the potential of being utilized in the context of us running the combined businesses going forward. I wouldn't talk more about that at this point until closing. We think the base business of YUPELRI is enough to drive the mid-teen IRR that we talked about and any other optionality around other assets, be it R&D or financial strategic assets would be a boost to that IRR. I think we'll leave that till later. It's an important attribute of why buying the company and reorganizing or sorting through the different components might be more beneficial than just accessing the product itself. We think we get a lot for that allocation that we've made to this acquisition. There's a lot to work with. I think it's an immediate return, as you said. I think we do have to finance the piece with OMERS, who's entitled to 75% of the gross margin to service their debt. There still is a near and immediate cash return and some long-term optionality for an investment that we had the ability to fund and felt we're disciplined about price to ensure we could get the type of returns that have to go along with the cost of capital from both the Royalty Pharma financing and from the OMERS financing. I think you're right. We think we got a lot for what we were able to spend to make this acquisition, and we can generate those types of returns from there. I think one of the items that we discussed with Theravance was their belief that with ampre, although it had failed in a phase III trial recently, that there was something they still saw that might provide a benefit to patients that was an unmet need. They wanted the ability to see if there was a pathway for that to be continued, not in our capital, but in some other way. We've provided for that opportunity for Theravance's current thinking that there might be a pathway forward for this medicine for patients. We've allowed for that in the transaction. We obviously have consent and approval rights of any transaction. We'll look at that, but we're quite happy to give them the ability to see if there is a pathway to patients for that medicine. It's obviously not counted in our IRR at all, and we haven't assigned any value to that aspect. If they are successful to go ahead and find a pathway, then we're happy to keep 20% of that value for our shareholders. With that, I'm not sure if, Kristin, do you want to add anything to anything we talked about there? I think you had mentioned the cash-out for the inflows that we were getting, and I just want to clarify that we're referring to the $219 million of signed cash to acquire the $60 million run rate of cash flows. That $219 million is reduced by the near-term TRELEGY milestone that's coming in. That cash that we're using is really effectively reduced to really more of a 50% level. Just want to clarify that it's a much smaller net investment going out to acquire that Theravance piece on the other side. Thank you, Ken. Appreciate the color. Hopefully, we answered your multiple questions. Thank you. You did it all. Thank you. Thank you. Thank you. Our next question is going to come from Reni Benjamin with Citizens. Your line's open. Hey, good morning, guys. Thanks very much for taking the questions and congratulations on this very nice deal. Can you maybe help quantify the expected impact on the expense side, right? So the operating expenses, once this takes place, how much do you think it might increase? Are there certain synergies that we should be thinking about, again, on the expense side? Just related to this, why wouldn't this acquisition be something that Viatris, the partner, would consider? What is it that was unique that you brought to the table that they couldn't? Yeah, let me try and answer your second question, then the first one I'll provide a summary, then ask Kristin to follow along. I think from our standpoint, not specific to Viatris, but just overall, I think Theravance's strategic committee, they've been under strategic review for some time frame looking for different options for doing the company further. I think we've provided them with what we think is a really excellent opportunity for an outright acquisition of the company. We think that's a very attractive proposition for their shareholders, and that's why we're both pursuing that right now. It may be that we were quite comfortable with the multiple components that would come with an outright company acquisition and sorting through those to understand the value that can be derived from that whereas traditional royalty players or others may have been interested in aspects, but not everything. We certainly see an ability for us to go and extract value from everything that's available to us from this acquisition for the capital that we've invested in it alongside our partners. From the perspective, the go-forward, we can't talk too much until we get to close. Obviously, we've seen some prior disclosures from Theravance publicly about the reorganization of their company following the phase III study outcome earlier this year, and their belief that they could modify the company's cost structure to a situation where they could start driving annualized cash flows from YUPELRI and other things that would be substantial. Obviously, there'd be other synergies in that if that was done within one entity post-closing as opposed to separately, and we'll obviously take advantage of those. I think they were doing organizational and strategic changes that were things that we would've done to get to the value of the underlying assets within Theravance. We'll continue that work and obviously add some things of our own. We would expect that YUPELRI would make a positive contribution from day one, and that would be overall as well. I don't know if you want to say anything more, Kristin, about that. We're a little bit limited in what we could say till the closing. Anything you want to add, Kristin? Yeah. I would just say regarding the operating expenses, we are going to continue to remain focused on cost discipline. As Ken said, with the integration planning, including restructuring initiatives designed to reduce R&D and G&A, we will think about providing updated guidance for the combined business once the transaction is closed. Great. Thanks very much for taking the questions, and congrats. Oh, thank you. Thank you. Our next question will come from Yaron Werber with TD Cowen. Your line is open. Great. Congrats on your first meaningful deal. I have one question maybe, Ken, I'll take it in two parts. I guess the first one is there because they're interrelated. Yes. Is this going to be, let's say about $60 million, $75 million in profit, $75 million obviously being paid to OMERS. You are bringing in a whole company. Is this going to be accretive to you immediately? I know you're not profitable, but net is just going to be You're going to be, each year on an annual basis, operationally, is going to be accretive or not immediately. Secondly, you do have an 8.25% coupon. I assume, is that coupon going to be literally net interest annually of about $28 million, $29 million? Or is that going to be sort of capitalized as part of the royalty the way you do with the rest of the deals? This deal is sort of open-ended, right? It's 2036. I don't see an upper cap of 2x plus $350 million or so, right? That's an open-ended 10-year deal. Yeah. I'll let Kristin walk through the mechanics of the repayment with OMERS. I think on the first part, I think we can't say too much, but obviously Theravance had started a process of reorganizing themselves to be in a position where they could be generating positive annualized cash flow from the overall business driven by YUPELRI and other mechanics. We think that was the right direction, and obviously we're supportive and we'll continue that. We do believe that this investment that we're making can be accretive, and we'll provide some updated guidance on that overall. At the same time, in our own business, we know that we're expecting, because we're confident they'll come at FDA with the PDUFA date for Zani to get a $250 million milestone payment this year with a positive outcome before the PDUFA date. We will need to, because of that and the closing of this transaction, update our own guidance around the combined P&L of those organizations. We do expect, as I said in our marks, that we'll begin to get a return on our investment after closing immediately from YUPELRI and the reorganization that's already going on inside Theravance. I'll let Kristin answer the second part of that. Sure. What I would just say is if you look back on the slide in the presentation, the way that the cash flows come in, it's when OMERS gets their 75% and then the residual flows to us. That first part goes to repay interest and principal. Although it's not capped, it should be very easy to forecast because the principal is paying down over time with their interest. I don't know if that will help clarify. Yeah. Got it. It's principal and interest. Great. You're essentially, at this point, you're inheriting the whole company, then you're going to make some decision as to the pipeline, right? It sounds like you're going to keep the commercial organization, but you'll figure out whether you want to continue to downsize that company you're taking on. Is that fair? Yeah. We can't say much more until closing. Obviously they have made public statements about reorganizing the research group, reorganizing G&A, reducing their cost structure in such a way as to get to a positive annualized cash flow by Q3. Obviously we agree with that, they'll continue to make those changes between now and closing. At closing, we will talk about what other changes we might want to make for this. Obviously, the cash flow that can be generated from YUPELRI is an important part of the return for us from this arrangement. The co-promotion arrangement with their own sales force in the U.S. with Viatris seems to be still continuing to drive some good growth and providing some meaningful profit share from that 35% profit share. That's an important element. Then we'll evaluate the other opportunities for other financial milestones. The early-stage R&D assets that they have, we'll evaluate that and make some commentary when we close. We believe YUPELRI-based business is significant enough on the trajectory that we have that it can drive that mid-teens IRR. We have optionality on other assets which could drive returns further, depending upon what we plan to do with the other assets, whether they're financial, strategic, or R&D. Terrific. Thank you. Well, thank you for the questions. Thank you, as a reminder, to ask a question, please press star one one on your telephone. The next question comes from Stephen Willey with Stifel. Your line's open. Good morning. Congrats on the transaction. Pretty creative. I guess now that you have an operational acute care sales force in place, does that now inherently incentivize additional transactions there, just as a way to further leverage the carrying cost of that commercial infrastructure? Thanks. Good question. Again, we'll have more to say after closing the transaction, but I think it's fair to say that that hospital-based co-promotion force at Theravance, YUPELRI, does a good job with just that product and the amount of investment that's made and its impact on sales and how that flows through to their profit share. I think that is just a sustainable investment as a group, if it continues to be that productive as it has been over the past few years. There's no need to think about leveraging the cost of that. It's a pretty small and efficient group that has an impact on sales and their profit share in a meaningful way. As long as that can continue, then I think we're happy to allow that to continue. I don't think it means any other strategy for us to leverage that group or what that means for our own COPD asset that we're putting in the clinic next year. I think as a standalone, it's certainly a high-performing group that drives a good return. If there were ways to leverage that, we would always evaluate that, but it's not going to drive the next transaction around that set of commercial force that exists in the U.S. All right. Thanks. Take care. No, thank you. Thank you. I am showing no further questions at this time. I will now turn the call back over to Ken for closing remarks. That's great. Thank you, operator for monitoring the Q&A, and thank you for the questions. We certainly really appreciate your time today to understand the rationale for our proposed acquisition of Theravance Biopharma. We think it's a really interesting transaction and hopefully we've been creative around the way that we were able to finance it. We do believe that we can drive good returns out of this transaction. Look forward to reporting progress against closing the transaction. We'll obviously provide much more guidance post-closing of how we intend to integrate and drive value out of the combined operations and look forward to being able to do that. Thank you very much for your time today. Thank you. This does conclude today's conference call. Thank you for your participation, and you may now disconnect.