Tarsus Pharmaceuticals NASDAQ: TARS reported record third-quarter sales for XDEMVY and raised its full-year revenue outlook, citing increased patient demand, deeper prescribing activity among eye care professionals and a growing contribution from retreatment prescriptions.
XDEMVY net product sales totaled $194.6 million in the third quarter, up nearly 64% from a year earlier, according to Chief Commercial Officer Neera Clase. The company said the result came during a typically seasonally softer quarter for eye care practices, while weekly prescriptions reached an all-time high and momentum continued into the fourth quarter.
Chief Executive Officer and Chairman Bobby Azamian said Tarsus has dispensed more than 1 million bottles of XDEMVY since launch and surpassed $1 billion in cumulative net product sales. He also outlined the company’s broader objective of developing additional eye-care medicines through its internal pipeline and recent acquisitions.
XDEMVY Demand and Commercial Spending
Clase said three factors are supporting XDEMVY growth: greater patient awareness, broader and deeper utilization by eye care professionals, and retreatment demand. The drug is approved for Demodex blepharitis, which the company estimates affects approximately 25 million Americans.
The company’s direct-to-consumer efforts, including branded advertising featuring John Cena and unbranded disease-education campaigns, drove a 75% increase in what Clase described as high-value consumer actions, such as online chats, symptom quizzes and searches for doctors. Tarsus said prescription conversion rates were also higher than last year.
Tarsus increased its full-year direct-to-consumer spending by $5 million to approximately $95 million. Chief Financial Officer and Chief Strategy Officer Jeff Farrow said the company expects to continue spending substantially on direct-to-consumer advertising in 2027, potentially in an $80 million to $95 million range, while shifting investments toward channels and periods producing stronger returns.
Among prescribers, the number of eye care professionals writing at least five XDEMVY prescriptions per week increased about 20% sequentially in the third quarter. The company also presented a chart review at the American Academy of Optometry meeting that identified Demodex blepharitis in 91% of patients with recurrent chalazia or hordeola, which management said could support additional screening.
Approximately 20% of third-quarter XDEMVY prescriptions were for retreatment, and management expects the rate to settle in the low-20% range over time. Chief Medical Officer Liz Yeu said retreatment is generally driven by a return of symptoms recognized by patients or the presence of collarettes identified by clinicians. She added that conditions including meibomian gland dysfunction and ocular rosacea may be associated with higher retreatment risk.
Updated 2026 Outlook and Expenses
Tarsus raised its 2026 XDEMVY sales outlook to between $715 million and $730 million. The company said the revised outlook reflects stronger patient-demand trends, deeper provider utilization across patient segments and returns from its advertising investments, while accounting for fourth-quarter medical meetings and holidays.
- Gross margin is expected to remain at approximately 93%.
- SG&A expense is projected at $605 million to $620 million, including $45 million to $50 million of stock compensation.
- R&D expense is projected at $140 million to $155 million, including $20 million to $25 million of stock compensation.
Third-quarter SG&A expense was $168 million, reflecting promotional investments, the company’s new key account leader team and higher variable costs tied to XDEMVY volume, excluding acquisition-related costs. R&D expense was $44 million, excluding acquisition costs, as the company advanced TP-04, TP-05, IRX-101 and other programs.
Tarsus recorded $632 million in acquired in-process research and development charges during the quarter, including $81 million related to iRenix and $551 million related to Alkeus. The company ended the quarter with approximately $310 million in cash and cash equivalents.
Pipeline and International Plans
The company said its partner has launched TP-03 in China. Tarsus has deferred regulatory filings for TP-03 in Europe and Japan because of the current implications of most-favored-nation regulations.
Top-line results from the TP-04 ocular rosacea program and TP-05 Lyme disease prevention program remain expected in the first half of 2027. For TP-04, Chief Operating Officer Sesha Neervannan said the company is studying inflammation-related hallmarks of ocular rosacea, including redness around the eye and telangiectasia, or prominent blood vessels. If the current study produces positive data, Tarsus expects to consider starting a Phase III study in late 2027 or the following year.
For IRX-101, an investigational ocular antiseptic obtained through the iRenix transaction, Tarsus expects to begin the Phase III Comfort study in the first half of 2027, with top-line results anticipated in 2028. The company estimates cost to approval of $20 million to $30 million. Management said it expects the product, if approved, to be reimbursed separately through a J-code and potentially a C-code at launch.
Enrollment is continuing in the Phase III Northstar trial of gildeuretinol for Stargardt disease, acquired with Alkeus. Top-line results are expected in the second half of 2029, and Tarsus estimates the cost to approval at $150 million to $200 million. Neervannan said the FDA has endorsed the Northstar study design and endpoints, though the company continues discussions with the agency and retains the option of conducting another Phase III trial.
Management also said XDEMVY has intellectual-property protection through 2038, plus any potential Hatch-Waxman extensions. For gildeuretinol, Farrow said the company is currently guiding to orphan-drug exclusivity of about seven to seven-and-a-half years from approval, while evaluating possible additional intellectual-property opportunities.
About Tarsus Pharmaceuticals (NASDAQ:TARS)
Tarsus Pharmaceuticals, Inc is a commercial-stage ophthalmic pharmaceutical company focused on developing and marketing treatments for eye diseases with significant unmet medical needs. The company's portfolio is centered on therapies designed to address conditions affecting the ocular surface and eyelids.
Tarsus' lead product is XDEMVY (lotilaner ophthalmic solution) 0.25%, an eye drop approved by the U.S. Food and Drug Administration in 2023 for the treatment of Demodex blepharitis, an inflammatory eyelid condition associated with an infestation of Demodex mites.
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.
Before you consider Tarsus Pharmaceuticals, you'll want to hear this.
MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Tarsus Pharmaceuticals wasn't on the list.
While Tarsus Pharmaceuticals currently has a Moderate Buy rating among analysts, top-rated analysts believe these five stocks are better buys.
View The Five Stocks Here
The space race is growing fast, and you don’t have to have gotten in early on SpaceX to profit. This report shows seven space stocks you can buy today that may grow as rockets, satellites, defense, space internet, and new space technology become more important.
Get This Free Report
Continue following MarketBeat
Add MarketBeat as your preferred source on Google to see our latest stories in your feed.
