UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549


FORM 8-K

CURRENT REPORT

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







Date of Report: July      18, 2006

(Date of earliest event reported)




Theravance, Inc.

(Exact name of registrant as specified in its charter)





Delaware

(State or other jurisdiction 
of incorporation)


000-30319

(Commission File Number)


94-3265960

(IRS Employer 
Identification Number)






901 Gateway Boulevard, South San Francisco, CA

(Address of principal executive offices)

 

94080

(Zip Code)




650-808-6000
(Registrant's telephone number, including area code)




Not Applicable
(Former Name or Former Address, if changed since last report)








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:


 
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 1.01. Entry into a Material Definitive
      Agreement

      On July 18, 2006,
      Theravance, Inc., a Delaware corporation ("Theravance") and Astellas
      Pharma Inc., a Japanese corporation ("Astellas") amended their license,
      development and commercialization agreement dated November 7, 2005 to
      include Japan in their collaboration for the development and
      commercialization of Theravance's investigational antibiotic, telavancin
      (the "Amendment"). 

      Under the terms of the
      Amendment, Theravance grants Astellas an exclusive license to develop and
      commercialize telavancin in Japan, and Astellas will pay Theravance a $10
      million up-front payment. The Amendment also provides for a $5 million
      regulatory milestone payment to Theravance if the marketing and sale of
      telavancin is approved by Japanese regulatory authorities. In addition,
      Theravance is entitled to royalties on global sales of telavancin that
      will now include sales in Japan, and which, on a percent basis, range from
      the high teens to the upper twenties. Astellas has the right to terminate
      the collaboration in Japan for cause in certain circumstances, including
      those based on the results of the complicated skin and skin structure
      infections (cSSSI) clinical studies currently being conducted by
      Theravance. 

      Under the terms of the
      collaboration agreement, as amended, Theravance will lead the development
      of telavancin for cSSSI and hospital-acquired pneumonia (HAP) and
      collaborate substantially with Astellas in marketing in the U.S. for the
      first three years. Astellas will lead all other development, regulatory,
      manufacturing, sales and marketing activities worldwide, including Japan.
      Theravance will be responsible for substantially all costs to develop
      telavancin for cSSSI and HAP, and Astellas will be responsible for
      substantially all costs associated with further development and
      commercialization of telavancin. 

      In addition
      to the license rights to telavancin in Japan, Astellas will also receive
      an option to further develop and commercialize TD-1792 in Japan. TD-1792
      is a unique heterodimer antibiotic compound that combines the
      antibacterial activities of a glycopeptide and a beta-lactam in one
      molecule. TD-1792 is currently in Phase 1 human clinical studies.
      
Item 9.01. Financial Statements and Exhibits

(d)
      Exhibits

      
99.1       Press Release dated July 18, 2006 -
      Theravance and Astellas Add Japan to Collaboration on Telavancin,
      Investigational Antibiotic for Serious Infections
      
            99.1       Press
      Release of Theravance, Inc. dated July 18, 2006



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.








Dated: July      18, 2006



THERAVANCE, INC.

By:  /s/ Rick E Winningham                      

     Rick E Winningham

     Chief Executive Officer







Exhibit Index



Exhibit No.
Description


99.1
Press Release of Theravance, Inc. dated July      18, 2006