What Anika Therapeutics (ANIK) Said on Its Q3 Earnings Call

Key Points

• Third-quarter revenue rose 10% to $30.6 million, while the loss from continuing operations narrowed to $0.3 million. Adjusted EBITDA increased to $5.1 million from $0.9 million a year earlier.
• Anika lowered its 2026 commercial-channel growth forecast to 9%–13% amid slower U.S. elective surgery activity, but raised its OEM growth outlook and the lower end of its adjusted EBITDA margin forecast. Overall 2026 revenue growth is now expected at 6%–10%.
• The FDA found Anika’s Hyalofast application not approvable, citing primarily clinical data; the company is evaluating next steps and excludes U.S. sales from its forecasts. Separately, a new 10-year Boehringer Ingelheim distribution agreement is expected to provide $8 million in payments.

Anika Therapeutics NASDAQ: ANIK reported a 10% increase in third-quarter revenue and raised the lower end of its 2026 revenue and adjusted EBITDA margin forecasts, even as it lowered its commercial channel growth outlook following slower U.S. elective surgery activity.

The company also said the U.S. Food and Drug Administration had found its Hyalofast premarket approval application not approvable, primarily because of clinical data in the submission. Anika said it is evaluating regulatory options and continues to exclude U.S. Hyalofast sales from its revenue forecasts.

Third-quarter revenue rose to $30.6 million from $27.8 million a year earlier. The loss from continuing operations narrowed to $0.3 million, or $0.02 per share, from $3.2 million, or $0.22 per diluted share. Adjusted net income from continuing operations was $3.9 million, or $0.29 per diluted share.

Commercial Growth Outlook Reduced

Commercial channel revenue increased 17% to a record $14 million, supported by international osteoarthritis pain management products and the regenerative solutions portfolio. International osteoarthritis pain management revenue rose 19%, led by Cingal and Monovisc, while regenerative solutions revenue increased 12%.

President and Chief Executive Officer Steve Griffin said Integrity revenue grew more than 30% year over year and 37% for the first nine months. The tendon repair product generated $7.5 million over the trailing 12 months entering the fourth quarter.

Griffin said larger implant sizes had expanded Integrity’s use into foot and ankle and knee procedures. Anika also launched second-generation instrumentation in September to offer surgeons another insertion and deployment option.

Still, Griffin said U.S. elective surgical procedures were slower during the summer. He told analysts that the reduced commercial outlook reflected expectations for Integrity to be “a little bit lighter” than initially anticipated, though he said the product had seen a good rebound at the beginning of the fourth quarter.

Anika now expects 2026 commercial channel revenue growth of 9% to 13%, down from its prior range of 12% to 18%. It raised its OEM channel growth forecast to 5% to 9% from 0% to 5%. Overall revenue growth is expected to be 6% to 10%, compared with the previous forecast of 5% to 10%.

For 2027, the company reaffirmed its expectation for total revenue growth of flat to 5%, with OEM revenue flat to modestly lower. Senior Vice President and Chief Accounting Officer Ian McLeod corrected his prepared remarks during the question-and-answer session, saying the commercial channel growth forecast was 5% to 15%, rather than the 5% to 10% he initially stated.

Griffin said the 2027 outlook incorporates expected U.S. osteoarthritis pain market pricing declines. He said Anika is working with J&J to understand where pricing will stabilize.

Margins Improve as OEM Business Expands

OEM revenue rose 5% in the third quarter to $16.6 million. Anika also shipped the first commercial units of Hyalomatrix, a wound product, to a new OEM distributor.

Gross margin improved to 62% from 56% a year earlier but declined from 65% in the second quarter. Management attributed the sequential decline primarily to product mix, including the reintroduction of Hyalomatrix, which does not yet include future royalty revenue from product sales.

Griffin said a gross margin in the low 60s was a reasonable near-term expectation. Over the longer term, he said manufacturing productivity gains could offset pricing pressure, although Anika has not set a longer-term margin improvement target.

Adjusted EBITDA rose to $5.1 million from $0.9 million a year earlier, while falling from $7.1 million in the second quarter. The company raised the lower end of its 2026 adjusted EBITDA margin forecast to 15% to 17% from 13% to 17%.

Anika generated $8.4 million in operating cash during the quarter and spent $1.7 million on capital expenditures. It ended September with $45 million in cash and cash equivalents. Griffin said manufacturing capital expenditures remain the company’s first use of cash and that he expects positive operating cash flow in the fourth quarter alongside continued capital investment.

Regulatory Programs and Distribution Agreement

Following the FDA’s October notification on Hyalofast, Griffin said Anika is assessing potential next steps, including discussions with the agency about additional clinical evidence that might support a future approval.

For Cingal, Anika completed enrollment in a bioequivalence study in September, ahead of its prior year-end target. The study report is expected in the first quarter of 2027. Griffin said the company also needs to complete manufacturing and quality work to support filing hyaluronic acid as a drug, and expects to submit a new drug application before the end of 2027.

Anika also entered a new 10-year distribution agreement with existing Hyvisc partner Boehringer Ingelheim. The agreement includes higher transfer pricing, royalties on end-market sales and higher minimum purchases. Anika expects $8 million in payments: $4 million upfront in the first quarter of 2027 and another $4 million tied to commercial volumes.

Griffin said the upfront payment is included in the 2027 outlook and will be amortized over 10 years for accounting purposes. He said the cash would support capital investments.

About Anika Therapeutics (NASDAQ:ANIK)

Anika Therapeutics, Inc develops, manufactures and commercializes therapeutic products designed to support tissue protection, healing and repair. The company focuses primarily on orthopedics, with products based in part on hyaluronic acid, a naturally occurring substance found in connective tissue and joint fluid.

Anika's orthopedic portfolio includes Monovisc and Orthovisc, viscosupplementation products used to help relieve pain associated with osteoarthritis of the knee, as well as Cingal, which combines hyaluronic acid with a corticosteroid.

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