Xeris Biopharma Holdings (NASDAQ:XERS) released second-quarter financial results and hosted an earnings call on Thursday. Read the complete transcript below.

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Access the full call at https://events.q4inc.com/attendee/250146676

Summary

Xeris Biopharma Holdings reported a record-breaking second quarter with total revenue reaching $92 million, driven by 34% year-over-year growth in net product revenue primarily led by Recorlev's 81% growth.

The company made strategic advances by strengthening its intellectual property portfolio and completing the retirement of convertible notes, thus simplifying its capital structure and eliminating nearly $3 million in annual interest expense.

Xeris raised the bottom end of its full-year 2026 total revenue guidance to $385-$390 million, reflecting confidence in its diversified commercial portfolio and long-term growth outlook.

Operationally, Recorlev has seen a record number of new patient starts and prescribers, while Gvoke rebounded with a 10% increase in prescriptions, and Keveyis demonstrated durability in its market.

In pipeline updates, significant progress was made with XP8121, including IP expansions and preparations for a Phase 3 start by year-end, with a dedicated program overview scheduled for September 9th.

Full Transcript

Leah, Operator

Hello everyone. Thank you for joining us and welcome to Xeris Biopharma Holdings second quarter earnings conference call. After today's prepared remarks, we will host a question-and-answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. I will now hand the conference over to Allison Wey, Senior Vice President of Investor Relations. Allison, please go ahead.

Allison Wey, SVP Investor Relations & Corporate Communications

Thank you, Leah. Good morning everyone and welcome to Xeris Biopharma Holdings' second quarter financial results conference call. Early this morning we issued a press release detailing our results. This press release can be found on our website. Joining me on today's call is John Shannon, our Chairman and Chief Executive Officer, and Steve Piper, our Chief Financial Officer. Following our prepared remarks, we'll open the call for your questions. Before we begin, I'd like to remind you that today's discussion will include forward-looking statements regarding Xeris Biopharma Holdings' future expectations, plans, strategies, objectives and financial performance. These forward-looking statements are based on management's current assumptions and beliefs and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those expressed or implied. For a discussion of these risks and uncertainties, please refer to the risk factors described in our filings with the SEC. Any forward-looking statements made on this call speak only as of today's date and except as required by law, the company undertakes no obligation to update or revise these statements.

In addition, during today's call we will reference certain financial measures that are presented on a non-GAAP basis. A reconciliation of these non-GAAP measures to the most directly comparable GAAP measures is included in our earnings release. And with that, I'll turn the call over to John.

John Shannon, CEO and Director

Thank you, Allison, and good morning everyone. The second quarter was another record-breaking quarter for Xeris Biopharma Holdings, one that demonstrated once again that the commercial momentum we have built is durable and accelerating. Total revenue reached 92 million with net product revenue of 91 million, representing 34% growth year over year. Recorlev led the way with 81% growth. Keveyis delivered another quarter of steady, reliable performance.

And Gvoke improved sequentially as we expected. But the second quarter was more than a commercial story. It was a quarter of meaningful strategic progress. We made significant strides in strengthening our intellectual property portfolio across both our commercial franchise and our pipeline. And shortly after quarter end, we completed the full retirement of our convertible notes, simplifying our capital structure and eliminating nearly 3 million in annual interest expense.

The progress we achieved reflects the breadth and defensibility of our science, the financial strength we have earned, and reinforces our confidence in the long-term value of what we're building. Taken together — a record commercial performance, a stronger IP portfolio and an enhanced balance sheet — the second quarter reflects the disciplined, compounding progress we are making to build a high-value biopharmaceutical company. In other words, we're executing and we're just getting started.

Based on our strong first half performance and our conviction in the growth trajectory of this business, we are raising the bottom end of our full year 2026 total revenue guidance to 385 to 390 million. This reflects our confidence in this team, the performance of our diversified commercial portfolio and the long-term growth outlook of our business. With that, let's turn to our brands, beginning with Recorlev. Recorlev continues to demonstrate exceptional momentum and in the second quarter it delivered yet again.

Recorlev net revenue increased to nearly 57 million in the quarter, representing 81% growth year over year, an increase of over 25 million. Behind that number, Recorlev had a record number of referrals, new patient starts, patients on therapy, new prescribers and total prescribers. Quarter after quarter, Recorlev has delivered sustained growth. That speaks to the execution of our commercial team and most importantly the deepening confidence prescribers have in Recorlev as their treatment of choice for endogenous Cushing's syndrome.

We believe Recorlev should be the standard of care and we intend to build on that. Importantly, we are still in the early stages of realizing the benefits of the commercial expansion we completed in January. Throughout the second quarter our focus was on training and deploying our expanded team. Execution is tracking in line with our expectations and we are increasingly well positioned to accelerate growth as these investments gain traction in the second half.

Turning to Gvoke. After a slow start to the year, Gvoke rebounded nicely in the second quarter, delivering net revenue of approximately 23 million and prescription growth of 10% versus the first quarter. I am proud of the team's work to put Gvoke back into growth mode and the sequential improvement gives us confidence that Gvoke is back on the right track. Looking ahead, the back-to-school season should provide its typical third quarter lift as families with children managing diabetes ensure they have a ready-to-use Gvoke on hand for the school year.

The long-term opportunity for Gvoke remains unaltered and our commitment to it is unwavering. Of the 15 million people with diabetes who should have a potential life-saving product like the Gvoke HypoPen, only a million or so do. Closing that gap remains an important opportunity for us and, more importantly, a meaningful way to improve patient outcomes. And finally, Keveyis. Keveyis delivered nearly 12 million in net revenue, once again demonstrating the remarkable durability of this brand in an ultra-rare market.

Maintaining patients on therapy remains the ultimate proof point and our results continue to reflect both the clinical value of Keveyis and the patient-centric support infrastructure we have built for the PPP community. Our commitment to this brand and this community couldn't be more evident than through our steadfast multi-year effort to secure important IP protection for Keveyis. On June 11, we received a Notice of Allowance from the U.S. Patent Office for a new patent covering Keveyis.

Once issued, it will provide renewed protection for Keveyis through at least 2039. With a clear line of sight to such extended protection and having evidenced such astounding durability during its period of non-exclusivity, we intend to invest incrementally in both Keveyis and the PPP community in order to expand efforts to identify and support even more patients in the future. Turning to our pipeline, and specifically XP8121, the second quarter was a busy period for our program.

During the quarter we continued to build an even stronger intellectual property estate around this important product and our proprietary formulation technology. On July 28, we received our second U.S. patent covering XP8121. Just one week earlier we also received a Notice of Allowance for an additional patent application which, when issued, will be our third U.S. patent. Our expanding intellectual property portfolio speaks to the depth of our innovation and the long-term defensibility of this product.

Those achievements build on the significant progress we made during the second quarter. Our technical and clinical teams made great progress in advancing the program through critical milestones. Importantly, we finalized our clinical site selections and those sites are busy preparing in advance of an expected Phase 3 start by year end. We also maintained a strong presence at key medical conferences throughout the quarter. The feedback we received from the endocrinology community has been exceptional, further reinforcing both our conviction in the significant unmet need in hypothyroidism and the multibillion-dollar commercial opportunity we have laid out. All of this momentum makes our planned XP8121 program overview that much more exciting. On Wednesday, September 9th, we will host a dedicated XP8121 webinar where you will hear directly from an important key opinion leader as well as members of our program team. We will walk you through the unmet medical need, the market opportunity and our planned Phase 3 program in detail, including trial design, primary and secondary endpoints, target patient population, as well as expected development and related regulatory timelines.

We believe XP8121 represents a significant advancement in addressing the real and persistent challenges of treating hypothyroidism and we believe it has the potential to be a blockbuster. Before I turn the call over to Steve, I want to briefly recap the strong progress we are making against the three critical priorities we outlined in March and continue to keep in our focus. First, driving rapid revenue growth. We delivered 33% growth in the first half and we are now guiding to full year revenue growth of 33% at the midpoint.

Our commercial business is growing fast. Second, advancing our pipeline. The XP8121 program remains on track and on September 9th we will provide the market with a comprehensive look at the program. We look forward to that conversation. And third, executing with discipline. The full retirement of our convertible notes completed in July is a direct expression of this priority in action — a proactive, planful step made possible by the ever-strengthening financial position of Xeris Biopharma Holdings.

With our sustained commercial momentum and disciplined execution against our strategic priorities, I couldn't be more excited about the company we're building, and with that I'll turn the call over to Steve.

Leah, Operator

We will now begin the question-and-answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. We ask that you pick up your handset when asking a question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from the line of Dennis Ding with Jefferies.

Your line is open. Please go ahead.

Georgia, Analyst at Jefferies

Hi, thank you for taking our questions. This is Dortje Bank on the line for Dennis Ding. I had a question about raising the low end of your guidance. I see that you raised it again to 385 but held the 390 top. And given Recorlev's momentum, and you said the expansion benefit is still mostly ahead in the second half, I guess what's capping the ceiling? And then on the expansion you noted that, you know, it's tracking in line. Are you able to hear me now?

Oh, sorry about that. Okay, so on the guidance raise, you raised the low end again in Q2 to 385, but held the top at 390. Given Recorlev's momentum, and you've said the expansion benefit is still mostly ahead in the second half, I guess what's capping the ceiling there? And then on that sales expansion you noted that the execution is tracking in line and still early. Maybe can you unpack what in line looks like underneath, which leading indicators, referrals, new starts, et cetera, that you're watching to confirm that the H2 setup is materializing?

Thank you. Great. Thank you so much.

Leah, Operator

Your next question comes from the line of Brandon Folks with H.C. Wainwright. Your line is open. Please go ahead.

Brandon Folks, Analyst at H.C. Wainwright

Hi. Thanks for taking my questions and congratulations on the quarter. Can you just further detail the second half of the year, the quarterly growth drivers, just how much is driven by higher territories versus sort of the new sales reps, you know, any way to just characterize where those new reps are in terms of productivity? And then any other tailwinds you're expecting in the second half of the year, whether it be average dose, persistency, just how those sorts of metrics are tracking.

Thank you.

John Shannon, CEO and Director

Yeah, Brandon, thanks for the question. You know, in terms of, you know, the back half of the year, you know, we made this expansion to increase not only the breadth of our calls—so we expanded our targets—but the depth within our calls. So it's going to come across existing prescribers and new prescribers and it's going to come across all territories, new and existing. So we see it coming across everywhere, and that's kind of how we set up the expansion.

In terms of changes to anything like dosing or anything else like that, with the amount of expansion we're going through and the number of new starts, we are watching all those metrics, but we don't expect them to materially change in this time and period of growth at these rates. So we continue to monitor those, we track them, and all of those trends are tracking as we expected and within line. And until they become more material, we really won't change our expectations around some of those things.

Brandon Folks, Analyst at H.C. Wainwright

Great, thanks very much. And maybe just one on 8121, can you just elaborate on what still needs to be done before the phase 3 initiation? And, you know, do you expect all of that to be done by the time you host the webinar? And if not, sort of how should we think about timing or what needs to be done? Thank you.

John Shannon, CEO and Director

Yeah, I think, yeah, I've said this before: we're not going to start that phase 3 trial till we have the go-to-market, present commercial presentation ready to go into that phase 3 trial. And that's what we're doing, is we're, you know, going through all of the work it takes to be able to have the commercial-ready product—device, formulation, everything. And we will, we'll be in a real solid, great position by the webinar to, you know, tell you where exactly all those timelines are.

I will tell you they're all on track. They're all tracking to what we said back last June in terms of start of the trial, data, regulatory submissions, and approval. So we're still on track for all that for a 2030 launch.

Brandon Folks, Analyst at H.C. Wainwright

Great, thank you very much.

Leah, Operator

Your next question comes from the line of David Amsalem with Piper Sandler. Your line is open. Please go ahead.

David Amsalem, Analyst at Piper Sandler

Hey, thanks. So just a couple for me. First, on Recorlev, can you talk about prescriber breadth and depth, and sorry if I missed this, but can you give color on how many prescribers there are and repeat prescribers? So that's number one. Number two is on 8121. Can you talk to how long you think it's going to take to enroll the phase 3, and do you think results could be a '28 event? And then lastly, business development, M&A—just given the commercial infrastructure in place, how aggressive are you going to be in terms of looking for assets where you can leverage that infrastructure?

John Shannon, CEO and Director

Okay, starting with Recorlev. So what we have said is we have 12,000 targets that we basically aligned our sales efforts against. And what I can tell you is that those are new and existing prescribers, and they're all known good targets for cortisol normalization in hypercortisolemia and Cushing's syndrome. So we are targeting those, we are successfully covering them, and it really goes to us having a record quarter of new prescribers as well as existing prescribers.

So all of those metrics are growing and growing at the pace that we expected in our guidance. And we continue to see that for the balance of the year and going forward as we go deeper and deeper in those accounts. The next question was on XP-8121, and I think it was related to data by '28. Oh, data by '28. We'll be able to give you a lot more clarity around that whole clinical program and timing. On September 9th you'll be able to see all that. So the clinical and regulatory timelines will be really, really clear at that point.

And on business development, as we've said before, we're focused on driving top-line growth and making investments that will continue to drive more and more growth within our company. From a business development standpoint, and with our financial position where it's at, we're looking at more and more opportunities that can deliver growth between now and even before the launch of 8121 in 2030. Those are the kinds of things that we would focus on, especially ones that leverage our endocrinology footprint and/or our rare product capabilities that we have within Xeris Biopharma Holdings.

Leah, Operator

Thank you. Your next question comes from the line of Chase Knickerbocker with Craig-Hallum. Your line is open. Please go ahead.

Jake, Analyst at Craig-Hallum, on behalf of Chase Knickerbocker

Morning, everyone. Thanks for taking the questions. This is Jake on for Chase. First, just on Recorlev, was hoping that you could characterize the growth in the market we are seeing, as you all do have better data than us. How many patients do you think are currently on therapy for hypercortisolism, and what share of new patient starts do you think you are capturing?

John Shannon, CEO and Director

Wow. We haven't really dug into that in the past, and it's really hard to triangulate that because we don't have good external data sources that could tie back to that. But what I will tell you is that more than 60% of our patients are new to therapy, first time on drug. So I would say that points to a couple things. One is the majority of our patients are market growth and us capturing a significant share of those, and the fact that the dynamics in this marketplace with everybody growing in it says that there's still a lot of opportunity for market growth.

And having said that, there doesn't seem to be an increase in switching, and so we're all getting and driving more screening, more detection, and more growth in the marketplace and really kind of positioning our product in a sense to kind of win those new patients.

Jake, Analyst at Craig-Hallum, on behalf of Chase Knickerbocker

Thanks for that color. And then second, how do you think we should think about the new Keveyis patent? Obviously, this represents a barrier to any potential future generic. Should we also be thinking about this as relevant to the current generic that's on the market right now?

John Shannon, CEO and Director

Well, I think the way we think about it is with this kind of protection, we for sure are really confident in investing more in finding more patients and getting them on therapy. So from that perspective, we have maintained this brand for the last year and a half based on driving new patients in a space with a non-exclusive situation. So we know we can grow it in a non-exclusive situation, and it only gets better if it somehow becomes more exclusive later on.

But for now, we're excited in and of itself that we can continue to grow this and really drive some growth in the future.

Jake, Analyst at Craig-Hallum, on behalf of Chase Knickerbocker

Great. Thanks for that commentary.

Leah, Operator

Your next question comes from the line of Roanna Ruiz with Leerink Partners. Your line is open. Please go ahead.

Ryan, Analyst at Leerink Partners, on behalf of Roanna Ruiz

Hey guys, you have Ryan on for Roanna. Thanks for taking our question and congrats on the quarter. Maybe just two from us. Can you help frame how discontinuation rates are looking for Recorlev, and are you seeing any signs of patients re-entering the funnel that may have previously dropped off therapy? And then, as you think about peak sales for Recorlev, what are the key levers here that could potentially accelerate the timeline to that peak sales of a billion dollars?

Thank you.

John Shannon, CEO and Director

So discontinuation rates have been pretty steady and stable. We don't really see any movement in that. We do see small amounts of patients that go off and come back and things like that. Again, none of those trends have really changed; they've been pretty consistent. In terms of peak, I think this is an important point for everybody: this is a market where it takes a lot of effort. These are complex patients that need to be diagnosed, screened, and treated.

So it's more of a scalable process to get these patients on drug and get them stabilized on drug, get them titrated, and keep them on drug. It's one of those areas where continued investment will be required, both from a commercial standpoint but also from a data generation and data dissemination standpoint. Those are critical aspects to really sustaining the long-term growth of this category.

Leah, Operator

Your next question comes from the line of Leland Gershel with Oppenheimer. Your line is open. Please go ahead.

Tracee, Analyst at Oppenheimer, on behalf of Leland Gershel

Hi, this is Tracee on for Leland. Congrats on the quarter and thanks for taking our question. Just one from us. Can you give us a sense of how to think about the XP-8121 Phase 3 program's impact on OPEX going forward?

Steven Pieper, Chief Financial Officer

Yeah. So I think, Tracee, thanks for the question. I'll take this one. You know, we guided to an increase in R&D this year of 25 million, and that increase is almost entirely for XP-8121 and starting the trial later this year. So it's everything that goes into that as the trial unfolds next year. I think it's reasonable to expect a similar increase in R&D spend as the trial ramps up, and so we'll lay that out in terms of our guidance early next year specifically, and you'll be able to understand exactly how that kind of tracks out with everything that we're laying out in terms of the program in September at the webinar.

Tracee, Analyst at Oppenheimer, on behalf of Leland Gershel

Sounds good. Thank you for the color.

Leah, Operator

There are no further questions at this time. I will now turn the call back to John Shannon for closing remarks.

John Shannon, CEO and Director

Thanks, everyone. As you just heard, the second quarter marked another remarkable period for Xeris, underscoring sustained commercial momentum and disciplined execution against our strategic priorities. Recorlev is growing and driving the business. Gvoke is back on track, and Keveyis has delivered a landmark IP win. At the same time, we continue to advance the next phase of our growth story. Our XP-8121 program is progressing well, and with Phase 3 initiation expected before year-end, we believe we're approaching an important inflection point for the program.

Our XP-8121 program overview on September 9th will provide investors with a closer look at what we are building. In closing, we enter the second half of 2026 with strong commercial momentum, a strengthened financial foundation, and a pipeline that positions us well for continued growth. Thank you for joining us today, and thank you for your continued support and interest in Xeris Biopharma Holdings.

Leah, Operator

This concludes today's call. Thank you for attending.

Disclaimer: This transcript is provided for informational purposes only. While we strive for accuracy, there may be errors or omissions in this automated transcription. For official company statements and financial information, please refer to the company's SEC filings and official press releases. Corporate participants' and analysts' statements reflect their views as of the date of this call and are subject to change without notice.