What OPKO Health (OPK) Said on Its Q3 Earnings Call

Key Points

• OPKO reported 16% growth in Q3 continuing-operations revenue to $65.4 million, with global products revenue up 11% and the segment returning to operating income. The continuing-operations loss narrowed to $31.4 million, while biotech losses widened as the company invested in early-stage programs.
• OPKO’s proposed sale of BioReference assets to Labcorp would bring about $722 million in cash at closing, plus potential royalties of up to $150 million from 4Kscore revenue. The deal would end OPKO’s clinical laboratory services business and shift its focus toward biotechnology and global products; closing remains subject to approvals and other conditions.
• The company withdrew its prior consolidated full-year guidance and forecast continuing-operations revenue of $268 million to $278 million. It also reported $403.2 million in cash and shared development updates, including plans for MDX-2001 subcutaneous studies around early 2027 and first-in-human MDX3001 studies targeted for mid-2027.

OPKO Health NASDAQ: OPK reported 16% growth in third-quarter revenue from continuing operations and outlined plans to focus on drug development and pharmaceutical products following its proposed sale of BioReference assets to Labcorp.

The transaction, announced Oct. 15, would provide approximately $722 million in cash at closing, subject to an adjustment based on the revenue of the business leading up to the sale. OPKO also would be eligible for up to $150 million in royalties tied to 4Kscore revenue over 10 years. Closing remains subject to regulatory approvals and customary conditions.

Chairman and Chief Executive Officer Phillip Frost said the sale, once completed, would mark OPKO’s exit from clinical laboratory services and allow the company to direct its management attention and capital toward biotechnology and its global products business.

Labcorp sale reshapes reporting and outlook

The assets being sold include clinical and women’s health testing, urology and corrections businesses, more than 80 patient service centers and the FDA-approved 4Kscore test, Chief Financial Officer Adam Logal said. BioReference will continue operating until the transaction closes.

OPKO has classified BioReference as held for sale and presented it as discontinued operations for all periods, recasting prior results. Continuing operations are now reported in two segments: global products and innovative biotech.

Logal said OPKO expects approximately $125 million in costs and expenses related to the sale, to be recorded from the fourth quarter of 2026 through completion of a transition services agreement. The company expects that agreement to last about one year after closing.

OPKO withdrew its previous consolidated full-year guidance for total revenue and costs. For continuing operations, it forecast full-year revenue of $268 million to $278 million and costs and expenses of $390 million to $395 million. For the fourth quarter, it expects continuing-operations revenue of $62 million to $72 million and costs and expenses of $100 million to $105 million.

The company also projected a fourth-quarter loss from discontinued operations of approximately $40 million, or about $0.05 per share, including BioReference’s operating loss, employee retention costs and expenses related to shorter expected useful lives for certain assets.

Product revenue and royalties support growth

Third-quarter revenue from continuing operations rose to $65.4 million from $56.4 million a year earlier. Global products revenue was $48.4 million, including $41.8 million in product revenue, up 11%, driven by OPKO Iberoamerica and RAYALDEE.

The global products segment also recorded $5.8 million in mazdutide royalties and posted operating income of $6 million, compared with an operating loss of $1.2 million in the prior-year quarter.

Innovative biotech revenue was $17 million, including $8.7 million in Pfizer gross profit share and $7.5 million in funding from the Biomedical Advanced Research and Development Authority, or BARDA. The segment’s operating loss widened to $26.8 million from $22.5 million as OPKO increased investment in early-stage clinical programs.

OPKO’s operating loss from continuing operations narrowed to $31.4 million from $33.6 million. The company ended the quarter with $403.2 million in cash, cash equivalents and restricted cash.

In August, OPKO raised $125 million through secured notes backed by its mazdutide royalty interest. Logal said the royalties will be used to pay down the notes until total payments reach a cap of 1.5 times the amount funded, after which OPKO retains the future royalty economics.

The company repurchased approximately 7.2 million shares for $10.6 million during the quarter, leaving about $84.3 million under its existing authorization. Asked about further returns to shareholders after the Labcorp deal closes, Logal said the board would consider whether to accelerate and expand share purchases as appropriate.

Clinical programs move toward further data

President and Vice Chairman Elias Zerhouni said OPKO had enrolled 41 patients in the Phase I study of MDX-2001, a tetraspecific T-cell engager for solid tumors, as of Sept. 30. Chief Innovation Officer Gary Nabel said the company believes it is approaching the maximum tolerated intravenous dose and is shifting enrollment toward tumors where it may have a greater chance of seeing activity.

OPKO has approval to begin subcutaneous dosing of MDX-2001, with studies expected around early 2027. Nabel cautioned that tolerability of that approach remains unknown and said intravenous dosing remains the first priority.

For MDX-2004, an immune-stimulating candidate not directed at a specific tumor antigen, Zerhouni said 16 patients had enrolled as of Sept. 30 and the study had reached its fourth dose cohort. Nabel said the company plans to look for preliminary signals across tumor types and, once safety is established, study patients whose tumors are resistant to PD-1 treatment.

OPKO completed enrollment in planned Phase I cohorts for MDX-2301, its BARDA-funded COVID-19 antibody, and reported a favorable blinded safety profile across evaluated doses. The company is compiling additional data to inform potential later-stage development.

First-in-human studies of OPKO’s MDX3001 in vivo CAR-T program are targeted for mid-2027, initially in autoimmune disease. Zerhouni said the revised timing reflects new regulatory requirements for starting investigator-initiated trials in China.

About OPKO Health (NASDAQ:OPK)

OPKO Health, Inc is a healthcare company focused on diagnostics and pharmaceuticals. Through its BioReference Laboratories business, the company provides clinical laboratory services, including routine testing, specialty diagnostics, genetic testing and oncology-related laboratory services. OPKO also develops diagnostic products, including the 4Kscore test, a blood test designed to help assess the risk of aggressive prostate cancer.

In pharmaceuticals, OPKO develops treatments for kidney disease, endocrine disorders and other conditions.

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