What Verastem (VSTM) Said on Its Q3 Earnings Call

Key Points

• Third-quarter product revenue was $24 million, up 114% year over year as refills of Verastem’s ovarian cancer CO-PACK offset slower new-patient starts. The non-GAAP adjusted net loss widened to $72.8 million from $39.1 million a year earlier.
• Verastem plans to start a phase III trial of VS-7375 in first-line pancreatic cancer by year-end 2026, following early trial responses; phase III trials in colorectal and lung cancer are planned for the first half of 2027, subject to FDA alignment.
• After raising about $250 million in an October offering, Verastem reported a pro forma cash balance of $422.8 million and expects funding to last into the first half of 2028. CEO Dan Paterson plans to retire at year-end 2026, with Michael Bailey set to succeed him.

Verastem NASDAQ: VSTM reported $24 million in third-quarter 2026 net product revenue as refills of its ovarian cancer treatment offset a moderation in new patient starts. The company also outlined plans to begin a late-stage pancreatic cancer trial for its experimental drug VS-7375 by year-end.

Revenue from AVMAPKI/FAKZYNJA CO-PACK rose 114% from the third quarter of 2025, Chief Financial Officer Dan Calkins said on the company’s earnings call. The non-GAAP adjusted net loss widened to $72.8 million, or $0.72 per diluted share, from $39.1 million, or $0.53 per diluted share, a year earlier.

President and CEO Dan Paterson said the company expects its cash, proceeds from an October financing and anticipated CO-PACK sales to fund operations into the first half of 2028. Paterson also reiterated that he plans to retire as CEO at the end of 2026, when board member Michael Bailey will succeed him.

Refills Support CO-PACK Revenue

Chief Commercial Officer Dan Lyons said prescribing expanded across community and academic accounts during the quarter, while new patient starts moderated following significant growth in the second quarter. He attributed part of the moderation to late-summer seasonal headwinds and said starts can fluctuate in a rare disease market.

The company’s commercial strategy focuses on the CO-PACK’s approved use in KRAS-mutated recurrent low-grade serous ovarian cancer, including encouraging use at the first or next recurrence and helping patients remain on therapy, Lyons said.

Lyons also noted physician-directed use outside that indication, primarily in solid tumors such as pancreatic cancer. He said the CO-PACK is not approved for that use and Verastem does not promote it in that setting. Evolving pancreatic cancer treatment options could affect the business, he added.

The Food and Drug Administration accepted an application for a new AVMAPKI tablet formulation and blister pack presentation for priority review, with a February 2027 target date for a decision, executives said. If approved, the changes would replace four AVMAPKI capsules per dose with one tablet and eliminate the current refrigeration requirement. Lyons said the company expects to launch the presentation in the first half of 2027 if approved.

VS-7375 Development Plans

Verastem is studying VS-7375, an oral KRAS G12D inhibitor, in pancreatic, colorectal and non-small cell lung cancers. President of Development Dr. Michael D. Kauffman reviewed data released in October from the early-stage TARGET-D 101 trial.

In the 900-milligram monotherapy cohort of patients with previously treated pancreatic cancer, four of eight second-line patients and five of 14 patients treated in the third or fourth line had confirmed responses, Kauffman said. The 22-patient group included two complete responses. At the data cutoff, 16 patients remained on treatment, and median progression-free survival had not been reached after a median follow-up of 6.4 months.

Kauffman compared some results with data for other drugs but acknowledged that it is difficult to draw conclusions from direct comparisons across studies. In colorectal cancer, he said two of six patients in an early analysis responded to treatment at the 900-milligram dose. In lung cancer, the company reported a 43% confirmed response rate at 600 milligrams.

Across 48 patients receiving 900 milligrams in the phase I trial, one discontinued because of a treatment-emergent or treatment-related adverse event, Kauffman said. He said 10% experienced a grade 3 treatment-related event, with no grade 4 or 5 treatment-related events reported. The most frequent adverse events were gastrointestinal, including nausea, diarrhea and vomiting.

Three phase II trials are enrolling. Verastem expects to complete enrollment in the pancreatic and colorectal studies around year-end and in the lung study in the first half of 2027. The company plans additional data updates across the program in the coming months, primarily at medical meetings.

Late-Stage Trial and Financing

Verastem said it reached agreement with the FDA on the protocol for TARGET-D 301, a phase III trial of VS-7375 in first-line pancreatic cancer, and expects to initiate it before the end of 2026. The company plans to begin first-line phase III trials in colorectal and non-small cell lung cancer in the first half of 2027, subject to reaching alignment with the FDA on their protocols.

The pancreatic trial will randomize patients equally among three arms, with two-thirds receiving VS-7375 upfront and one-third receiving standard chemotherapy. Patients in the chemotherapy arm may cross over to VS-7375 after their cancer progresses, Kauffman said.

The trial will have overall response rate and progression-free survival as dual primary endpoints, while overall survival will be a secondary endpoint. Kauffman said the company could potentially discuss accelerated approval based on response data with the FDA, but does not have an explicit agreement that the agency would accept that basis for approval.

Verastem ended the third quarter with $172.8 million in cash, equivalents and investments. It subsequently raised approximately $250 million in gross proceeds in an October offering, producing a stated pro forma quarter-end cash balance of $422.8 million. Research and development expenses were $68.8 million in the quarter, while selling, general and administrative expenses were $26.5 million.

Bailey, the incoming CEO, previously led AVEO Pharmaceuticals through its acquisition by LG Chem and subsequently led the integrated company through June, Paterson said. Paterson plans to remain on Verastem’s board and serve as an adviser.

About Verastem (NASDAQ:VSTM)

Verastem, operating as Verastem Oncology, is a biopharmaceutical company focused on developing and commercializing targeted therapies for cancer. The company's research is centered on tumors driven by abnormalities in the RAS/MAPK signaling pathway, which can promote cancer-cell growth and resistance to treatment.

Verastem's leading product candidates include avutometinib, an oral RAF/MEK clamp designed to inhibit signaling within the RAS/MAPK pathway, and defactinib, an oral focal adhesion kinase inhibitor.

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