Apr 17, 2017

Innoviva Board Recommends Shareholders Vote "FOR" All of Innoviva's Qualified Directors on the WHITE Proxy Card

BRISBANE, Calif.--(BUSINESS WIRE)-- Innoviva, Inc. (the "Company" or "Innoviva") (NASDAQ: INVA) today announced its Board of Directors has issued the following letter to shareholders in connection with the upcoming Annual Meeting of Stockholders to be held on April 20, 2017.

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With strong and consistent growth in profits, Innoviva has been able to deliver increasing returns t ...

With strong and consistent growth in profits, Innoviva has been able to deliver increasing returns to shareholders - including capital returns of more than $210 million to investors since the first quarter of 2015. (Graphic: Business Wire)

April 17, 2017

Dear Fellow Innoviva Shareholder:

The Annual Stockholders Meeting of Innoviva, Inc. ("Innoviva" or the "Company") is just days away. We urge you to vote on the WHITE proxy card in favor of your current Board of Directors (the "Board"). We think the choice is clear.


Innoviva has delivered a 32% compounded growth rate in royalties over the last 10 reported quarters through an efficient, low-cost structure. With strong and consistent growth in profits, we have been able to deliver increasing returns to shareholders - including capital returns of more than $210 million to investors since the first quarter of 2015.


Innoviva strives to engage with all Innoviva shareholders and we have appreciated the shareholder support that we have received for our team and strategy during the proxy fight, including the following from our largest shareholder, GlaxoSmithKline plc ("GSK"):

"We support Innoviva's Board and management team's continuing effort to deliver significant shareholder value." - GSK, Schedule 13D/A filed April 13, 2017

We also welcome feedback on how to continue to deliver value for the benefit of our shareholders. As a result of our recent conversations with shareholders, your Board has determined to undertake a fresh, comprehensive review of all of our costs, including executive compensation structures. Your independent Board looks forward to continuing our active dialogue with all Innoviva shareholders.


In sharp contrast to our approach to shareholder engagement are Sarissa's repeated falsehoods and distorted attacks. When Sarissa launched its proxy fight without prior notice, it raised none of these issues with the Company - and in fact lauded Innoviva's management in private conversations. But in its attempt to distract from its self-serving agenda, Sarissa issues daily press releases with "fake facts."

Here are the real facts.

1. Active management:

"GSK has been a long-time partner of Innoviva and we continue to value the collaborative and productive relationship" - GSK, Schedule 13D/A filed April 13, 2017

2. Cost and compensation structure:

3. Access to Innoviva directors:

4. Governance:

5. Value destruction by the Sarissa team:

6. Sarissa trying to take effective control of Innoviva:

Now That You Have the Facts: Who Do You Want to Guide Your Company?

We urge you to protect the value of your Innoviva investment by voting the WHITE proxy card today.


The Board of Directors of Innoviva, Inc.



Your Vote Is Important, No Matter How Many or How Few Shares You Own!

If you have questions about how to vote your shares, please contact:


(888) 750-5834 (TOLL-FREE from the U.S. and Canada)

or (412) 232-3651 (from other locations)

Banks and Brokers May Call Collect: (212) 750-5833



Please simply discard any Gold proxy card that you may receive from Sarissa.
Returning a Gold proxy card - even if you "withhold" on Sarissa's nominees -
will not help your Company, as it will revoke any vote you previously submitted

on Innoviva's WHITE proxy card.


Please visit for more information.


About Innoviva

Innoviva is focused on bringing compelling new medicines to patients in areas of unmet need by leveraging its significant expertise in the development, commercialization and financial management of bio-pharmaceuticals. Innoviva's portfolio is anchored by the respiratory assets partnered with Glaxo Group Limited (GSK), including RELVAR®/BREO® ELLIPTA® and ANORO® ELLIPTA®, which were jointly developed by Innoviva and GSK. Under the agreement with GSK, Innoviva is eligible to receive associated royalty revenues from RELVAR®/BREO® ELLIPTA® and ANORO® ELLIPTA®. In addition, Innoviva retains a 15 percent economic interest in future payments made by GSK for earlier-stage programs partnered with Theravance BioPharma, Inc., including the closed triple combination therapy for Chronic Obstructive Pulmonary Disease (COPD). For more information, please visit Innoviva's website at

ANORO®, RELVAR®, BREO® and ELLIPTA® are trademarks of the GlaxoSmithKline group of companies.

Forward-Looking Statements

This press release contains certain "forward-looking" statements as that term is defined in the Private Securities Litigation Reform Act of 1995 regarding, among other things, statements relating to goals, plans, objectives and future events, including expected cost savings. Innoviva intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. The words "anticipate", "expect", "goal", "intend", "objective", "opportunity", "plan", "potential", "target" and similar expressions are intended to identify such forward-looking statements. Such forward-looking statements involve substantial risks, uncertainties and assumptions. These statements are based on the current estimates and assumptions of the management of Innoviva as of the date of this press release and are subject to risks, uncertainties, changes in circumstances, assumptions and other factors that may cause the actual results of Innoviva to be materially different from those reflected in the forward-looking statements. Important factors that could cause actual results to differ materially from those indicated by such forward-looking statements include, among others, risks related to: expected cost savings, lower than expected future royalty revenue from respiratory products partnered with GSK, the commercialization of RELVAR®/BREO® ELLIPTA® and ANORO® ELLIPTA® in the jurisdictions in which these products have been approved; the strategies, plans and objectives of Innoviva (including Innoviva's growth strategy and corporate development initiatives beyond the existing respiratory portfolio); the timing, manner, amount and planned growth of anticipated potential capital returns to shareholders (including, without limitation, statements regarding Innoviva's expectations of future purchases under its capital return programs and future cash dividends); the status and timing of clinical studies, data analysis and communication of results; the potential benefits and mechanisms of action of product candidates; expectations for product candidates through development and commercialization; the timing of regulatory approval of product candidates; and projections of revenue, expenses and other financial items. Other risks affecting Innoviva are described under the headings "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" contained in Innoviva's Annual Report on Form 10-K for the year ended December 31, 2016, which is on file with the Securities and Exchange Commission ("SEC") and available on the SEC's website at Additional factors may be described in those sections of Innoviva's Quarterly Report on Form 10-Q for the quarter ended March 31, 2017, to be filed with the SEC in the second quarter of 2017. In addition to the risks described above and in Innoviva's other filings with the SEC, other unknown or unpredictable factors also could affect Innoviva's results. Past performance is not necessarily indicative of future results. No forward-looking statements can be guaranteed and actual results may differ materially from such statements. Given these uncertainties, you should not place undue reliance on these forward-looking statements. The information in this press release is provided only as of the date hereof, and Innoviva assumes no obligation to update its forward-looking statements on account of new information, future events or otherwise, except as required by law.

Reconciliation of Non-GAAP Financial Measures to GAAP

In certain circumstances, results have been presented that are not generally accepted accounting principles measures ("Non-GAAP") and should be viewed in addition to, and not as a substitute for, Innoviva's reported results. Innoviva believes that the non-GAAP financial information provided in this press release can assist investors in understanding and assessing Innoviva's on-going operations and prospects for the future and provides an additional tool for investors to use in comparing Innoviva's financial results with other companies in Innoviva's industry or with similar operating profiles. Investors are encouraged to review the reconciliation of Innoviva's non-GAAP financial measures to their most directly comparable GAAP financial measures.

Please see the reconciliation that follows for additional information and the reconciliations of these non-GAAP financial measures to the closest GAAP financial measures.

Reconciliation of GAAP to Non-GAAP Operating Results

(in thousands)
          Eight Quarters Ended           Twelve Months Ended
Dec. 31, 2016 Dec. 31, 2016
(unaudited)           (unaudited)


GAAP net income $ 40,776 $ 59,536

Non-GAAP adjustments:

Interest expense (income), net 103,294 51,834
Stock-based compensation 15,171 8,297
Depreciation 240 131
Amortization of capitalized fees paid to a related party   27,646             13,823

*Adjusted EBITDA

$ 187,127 $ 133,621

Investor Contact:
Innoviva, Inc.
Eric d'Esparbes
Senior Vice President and Chief Financial Officer
Media Contacts:
Abernathy MacGregor
Patrick Tucker or Ina McGuinness
212-371-5999 or 213-630-6550 or

Source: Innoviva, Inc.

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