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RIGEL PHARMACEUTICALS INC (RIGL)·Q2 2025 Earnings Summary

Executive Summary

  • Rigel delivered a strong quarter: revenue $101.7M, diluted EPS $3.28, and net income $59.6M, with net product sales up 76% YoY; management raised FY25 guidance materially .
  • Results exceeded Wall Street consensus on revenue ($72.6M*) and EPS ($1.612*) as actuals came in at $101.7M and $3.28, respectively; EBITDA also ran above consensus (actual $61.7M vs $47.6M*) .
  • Guidance raised to total revenue $270–$280M (from $200–$210M), net product sales $210–$220M (from $185–$192M), and collaborations ~$60M (from $15–$18M); includes $40M non-cash contract revenue from Lilly .
  • Key catalysts: favorable patient affordability and gross-to-net dynamics under IRA, strong product demand across TAVALISSE/GAVRETO/REZLIDHIA, and R289 Phase 1b progression with dose-escalation enrollment completed .

What Went Well and What Went Wrong

What Went Well

  • “This was a really great quarter for Rigel… net product sales of more than $58M… total revenue $101.7M” (CEO) .
  • Commercial execution drove 76% YoY net product sales growth, aided by improved patient affordability and favorable gross-to-net dynamics (CCO) .
  • Pipeline progress: completed dose-escalation enrollment for R289 Phase 1b in lower-risk MDS; updated data expected later this year (PR/8-K) .

What Went Wrong

  • Results include $40M non-cash collaboration revenue from Lilly; investors should adjust underlying trends accordingly .
  • IRA tailwind likely moderates in 2H (coverage gap impact strongest in 1H), potentially tempering sequential benefit (CCO) .
  • Data integrity refinement in R289: one previously reported minor responder no longer qualifies after an updated data cut (CMO) .

Financial Results

MetricQ2 2024Q1 2025Q2 2025
Revenue ($USD Millions)$36.8 $53.3 $101.7
Net Income ($USD Millions)$(1.0) $11.4 $59.6
Diluted EPS ($)$(0.06) $0.63 $3.28
EBITDA Margin %2.9%*25.1%*60.7%*

Values marked with * retrieved from S&P Global.

Actual vs Consensus (selected quarters):

MetricQ2 2024 ConsensusQ2 2024 ActualQ1 2025 ConsensusQ1 2025 ActualQ2 2025 ConsensusQ2 2025 Actual
Revenue ($USD Millions)$33.7*$36.8 $43.9*$53.3 $72.6*$101.7
EPS ($)$(0.195)*$(0.06) $0.134*$0.63 $1.612*$3.28
EBITDA ($USD Millions)$(5.1)*$1.1 $0.5*$13.4 $47.6*$61.7

Values marked with * retrieved from S&P Global.

Segment net product sales:

Product Net Sales ($USD Millions)Q2 2024Q1 2025Q2 2025
TAVALISSE$26.4 $28.5 $40.1
GAVRETO$1.9 $9.0 $11.8
REZLIDHIA$5.2 $6.1 $7.0
Total Net Product Sales$33.5 $43.6 $58.9

KPIs and operating metrics:

KPI ($USD Millions unless noted)Q2 2024Q1 2025Q2 2025
Cost of Product Sales$2.8 $4.4 $4.5
Total Costs & Expenses$36.4 $40.6 $40.6
Weighted Avg Diluted Shares (M)17.549 18.169 18.162
Cash & ST Investments (period-end)—$77.1 $108.4
GTN Allowances (quarter)——$20.7

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Total RevenueFY 2025$200–$210M $270–$280M Raised
Net Product SalesFY 2025$185–$192M $210–$220M Raised
Contract RevenuesFY 2025$15–$18M ~$60M Raised

Notes: Current guidance and collaboration revenues are inclusive of $40M non-cash revenue from Lilly ; prior guidance explicitly excluded the $40M non-cash item .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024, Q1 2025)Current Period (Q2 2025)Trend
Patient affordability (IRA)No explicit IRA tailwind noted; focus on record bottles and portfolio momentum .Improved affordability and favorable gross-to-net dynamics drove demand across portfolio (TAVALISSE/GAVRETO/REZLIDHIA) ; IRA coverage gap elimination highlighted .Improving tailwind (expected to moderate in 2H)
Product performanceQ4 2024: strong quarter, record net product sales, expanding commercial footprint . Q1 2025: net product sales +68% YoY .Q2 2025: record net product sales +76% YoY; TAVALISSE +52% YoY, GAVRETO ramp, REZLIDHIA +36% YoY .Strengthening
R&D execution (R289)R289 received Fast Track and Orphan Drug; Phase 1b dose levels advancing .Completed dose-escalation enrollment; updated data later this year; dose-expansion initiation targeted 2H .Advancing
International expansionKissei and partner approvals/milestones (Korea, Mexico); licensing expansions in 2024 .TAVALISSE launched in South Korea via JW Pharma/Kissei .Expanding
Legal/regulatorySettlement with Annora on TAVALISSE generics; licensed entry no earlier than Q2 2032 .No new litigation disclosed; continued regulatory and partner activities .Stable
Gross-to-net/channelDistribution channel changes favorability mentioned for 2H 2024 .Favorable GTN persisted; CFO expects persistence with mix/programs ; GTN allowances $20.7M .Improving

Management Commentary

  • CEO: “This was a really great quarter… net product sales of more than $58M… total revenue $101.7M… recognized $40M in non-cash revenue… generated $59.6M in net income and increased our cash balance to more than $108M” .
  • CCO: “Accelerated demand through improved patient affordability in 2025 augmented by favorable gross-to-net dynamics” .
  • CMO: “Completed enrollment in the dose escalation part of our ongoing Phase 1b study evaluating R289… plan to share updated data later this year and initiate dose expansion in 2H” .
  • CFO: “We reported net income of $59.6M… raised total revenue guidance to ~$270–$280M… net product sales ~$210–$220M and collaborations ~$60M, inclusive of $40M non-cash from Lilly” .

Q&A Highlights

  • TAVALISSE growth drivers: more new patient starts than ever; improved affordability under IRA ($2,000 annual cap and payment smoothing) supported access; team prepared for policy change .
  • Growth trajectory: management expects continued growth but did not guide beyond FY25; acknowledges multiple drivers behind 1H inflection .
  • Gross-to-net outlook: favorable effects from channel changes, product mix, and IRA-adjustments; expects persistence though dynamics will evolve .
  • R289 update: one previously classified minor responder no longer qualifies after updated transfusion data entry; still on track for dose-expansion and regulatory alignment on potential registrational path .
  • Glioma program: Rigel-led Phase 2 design details to come later; CONNECT TARGET-D pediatric/AYA maintenance study open; exploring filing strategy possibilities with partners and agency .

Estimates Context

  • Q2 2025 results beat consensus: revenue $101.7M vs $72.6M*, EPS $3.28 vs $1.612*, EBITDA $61.7M vs $47.6M*; prior quarters also exceeded consensus .
  • Estimate revisions likely to move higher on net product sales trajectory and raised FY25 revenue guidance (note that guidance includes $40M non-cash collaboration revenue) .

Values marked with * retrieved from S&P Global.

Key Takeaways for Investors

  • Rigel’s commercial engine is accelerating across all three products with record net product sales and favorable gross-to-net tailwinds; monitor sustainability into 2H as IRA impact moderates .
  • FY25 guidance was raised significantly, reflecting stronger product demand and collaboration revenue recognition; investors should adjust for the $40M non-cash component when modeling recurring revenue quality .
  • Profitability inflected meaningfully (EPS $3.28; net income $59.6M) on leverage and mix; cash rose to $108.4M, strengthening balance sheet for pipeline investment .
  • R289 is advancing toward dose expansion with updated data by year end; a clearer registrational path could be a medium-term catalyst .
  • International expansion (e.g., South Korea TAVALISSE launch) and partner contributions support diversified revenue streams beyond U.S. .
  • Near term trading implication: positive momentum supported by beats and guidance raise; watch subsequent quarters for confirmation of durability absent non-cash revenue .
  • Medium-term thesis: balanced growth plus pipeline optionality (R289 and olutasidenib expansion) with disciplined cost posture; execution on clinical milestones and continued commercial expansion are key drivers .