Eton Pharmaceuticals NASDAQ: ETON reported second-quarter revenue nearly doubled from a year earlier, driven by the relaunch of HEMANGEOL and growth across its pediatric endocrinology and rare-disease portfolio. The company raised its full-year revenue and profitability outlook while outlining plans to advance newly acquired and internally developed products.
Revenue for the second quarter of 2026 rose 99% to $37.6 million, from $18.9 million in the prior-year period. Chief Executive Officer Sean Brynjelsen said HEMANGEOL, a treatment for infantile hemangioma, was the largest contributor to growth after its May 1 relaunch. He also cited continued momentum from Increlex, ALKINDI SPRINKLE, KHINDIVI, Galzin and Carglumic Acid.
The company increased its 2026 revenue outlook to more than $145 million, up from prior guidance of more than $120 million. It also expects its full-year adjusted EBITDA margin to exceed 35%, compared with previous guidance for a margin above 30%.
Profitability Expands as Revenue Grows
Adjusted EBITDA climbed to $16.2 million, or 43% of revenue, compared with $3.1 million, or 16% of revenue, in the second quarter of 2025. Net income was $11.6 million, or $0.35 per diluted share, compared with a net loss of $2.6 million, or $0.10 per share, a year earlier.
On a non-GAAP basis, Eton reported net income of $14.3 million, or $0.43 per diluted share, versus $1.5 million, or $0.03 per share, in the prior-year quarter.
Gross profit increased 113% to $25.4 million. Adjusted gross profit was $27.4 million, representing a 73% adjusted gross margin, down from 75% a year earlier. Chief Financial Officer Judy Matthews said the decline reflected higher Increlex sales outside the U.S., which carry a negative gross margin.
Eton expects full-year adjusted gross margin to exceed 70%. The outlook includes a potential commercial milestone expected in the fourth quarter if certain ALKINDI SPRINKLE and KHINDIVI net-sales thresholds are met.
Research and development expense was $1 million, down from $3.7 million a year earlier, primarily because the prior-year period included a DESMODA FDA filing fee. Eton now expects 2026 R&D spending of $10 million to $14 million, including a $3 million upfront licensing payment for ASN-001 that it expects to record as R&D expense in the third quarter.
As of June 30, Eton held $26.8 million in cash after making a $3 million prepayment on outstanding debt. Matthews said the company expects operating cash generation to grow in the second half and plans to use cash for accretive product acquisitions and accelerated repayment of its credit facility.
HEMANGEOL Transition Nears Completion
Eton said it had transitioned approximately 95% of HEMANGEOL patients to its Eton Cares single-pharmacy access model by the end of June, ahead of its original expectation that the process would take three to four months. Brynjelsen said the company believes it has now converted all patients from the prior distribution system.
Before Eton acquired the product, about 8,000 patients annually accessed HEMANGEOL through 18 pharmacies. The new model is intended to reduce out-of-pocket costs, improve access and provide round-the-clock patient support. The company offers a $0 copay program for the treatment.
Chief Business Officer David Krempa said Eton continues to estimate HEMANGEOL net pricing at $8,000 to $10,000 per treated patient for a full course of therapy. With the patient conversion largely complete, the company is focusing on increasing volume and converting patients who have historically used off-label adult formulations.
Brynjelsen said Eton expects annual HEMANGEOL patient volume to ultimately exceed 10,000. He added that DESMODA, which launched at the end of the first quarter, was not a major contributor to second-quarter growth but is expected to make a more meaningful contribution as the company exits 2026.
ASN-001 Adds Late-Stage Dermatology Candidate
Eton recently licensed ASN-001, a late-stage topical therapy candidate for moderate infantile hemangiomas. The company said the candidate could address an estimated 10,000 patients annually who are treated off-label with ophthalmic timolol because no FDA-approved topical therapy is currently available.
Management expects ASN-001 to complement HEMANGEOL, which is used for severe hemangiomas, rather than compete with it. Together, Eton estimates the two products could address 20,000 to 30,000 patients annually.
ASN-001 has completed a Phase III trial, according to Eton. The remaining development requirement is a 24-patient, 29-day bioavailability bridging study that management expects to begin in coming weeks and cost approximately $4 million over the next 12 months. The FDA has reviewed the proposed protocol, Brynjelsen said.
Eton expects to submit a new drug application for ASN-001 in the second half of 2027, potentially supporting approval and a launch in 2028. During the question-and-answer session, Brynjelsen said the company expects the candidate to leverage its existing hemangioma sales force and could become Eton’s largest revenue-generating product after launch.
Other Pipeline and Portfolio Developments
- KHINDIVI: Eton submitted a Prior Approval Supplement seeking to expand the product’s approved age range to patients under age five after a new formulation demonstrated bioequivalence to ALKINDI SPRINKLE. The company expects a decision in the first half of 2027.
- Increlex: The FDA signed off on Eton’s label-harmonization study protocol. The company has engaged a contract research organization and aims to dose the first patient by the end of 2026.
- Amglidia: The FDA granted Fast Track designation for the liquid glyburide treatment for neonatal diabetes. Eton plans to begin a bioavailability study in August, submit an NDA by year-end and seek priority review, with potential approval and launch in 2027.
- ET-700: Eton’s pilot study of its extended-release zinc acetate formulation for Wilson disease is underway. Initial results are expected within one to two months, with a full report anticipated by year-end. If successful, the company expects to start a pivotal study in early 2027.
- IMPAVIDO: Eton acquired U.S. rights to the oral therapy for severe forms of leishmaniasis and expects to begin U.S. distribution in late September. Management said it plans to use a concentrated specialist sales approach, Eton Cares support, and expanded Medicaid coverage to improve patient access.
Management reiterated long-term goals of reaching a $200 million annualized revenue run rate by the end of 2027, a 50% adjusted EBITDA margin in 2028 and $500 million in annual revenue by 2030. Brynjelsen said the company now believes it is ahead of its 2027 run-rate target and expects the addition of ASN-001 to support achieving or exceeding its 2030 revenue objective.
About Eton Pharmaceuticals (NASDAQ:ETON)
Eton Pharmaceuticals, Inc is a specialty pharmaceutical company focused on developing, manufacturing and commercializing generic and proprietary pharmaceutical products for patients with rare and underserved diseases. Headquartered in West Palm Beach, Florida, the company leverages its expertise in hormone therapies and complex molecules to address treatment areas where patient need is high and competition is limited. Since its founding in 2016, Eton has sought to build a diversified portfolio that combines established generic medicines with targeted branded offerings.
The company's product lineup includes thyroid hormone replacements such as desiccated thyroid and liothyronine, as well as pyrimethamine tablets indicated for toxoplasmosis.
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.
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