ETON

Image source: The Motley Fool. Thursday, Aug. 13, 2026, at 4:30 p.m. ET Chief Business Officer-David Krempa Chief Executive Officer-Sean Brynjelsen Chief Commercial Officer-Ipek Trinkaus Chief Financial Officer-Judy Matthews Operator: Good afternoon, and welcome to the Eton Pharmaceuticals second quarter 2026 financial results conference call. At this time, all participants are in listen only mode. Following the formal remarks, we will open the call up for your questions. Please be advised this call is being recorded at the company's request. At this time, I'd like to turn the call over to David Krempa, Chief Business Officer at Eton Pharmaceuticals. Please proceed. David Krempa: Thank you, operator. Good afternoon, everyone, and welcome to Eton's second quarter 2026 conference call. This afternoon, we issued a press release that outlines the topics we plan to discuss on today's call. The release is available on our website, etonpharma.com. Joining me on our call today, we have Sean Brynjelsen, our CEO, Ipek Trinkaus, our Chief Commercial Officer, and Judy Matthews, our Chief Financial Officer. Before we begin, I would like to remind everyone that today's remarks made during the call may contain forward-looking statements and involve risks and uncertainties that could cause actual results to differ materially from those contained in these forward-looking statements. Please see the forward-looking statements disclaimer in our earnings release and the risk factors in the company's filings with the SEC. Now, I will turn the call over to our CEO, Sean Brynjelsen. Sean Brynjelsen: Thank you, David. Good afternoon, everyone, and thank you for joining us today. We had an exceptional second quarter with record revenue, significant margin expansion, and important progress across both our commercial portfolio and pipeline. We also completed several strategic transactions that we believe will support Eton's continued long-term growth. I'll begin by highlighting a few of the quarter's key accomplishments. We once again achieved record revenue, delivering 99% year-over-year growth with contributions from across the portfolio. At the same time, we delivered significant margin expansion and accelerated adjusted EBITDA and net income growth. We established a strong commercial foundation in pediatric dermatology with the successful relaunch of HEMANGEOL, which is already performing ahead of our expectations. We expanded our portfolio through the acquisition of U.S. rights to IMPAVIDO and the licensing of ASN-001, adding both a commercial rare disease product and a late-stage development candidate that we believe has the potential to become the largest product in our portfolio. Finally, we had a very productive few months on the R&D front. We submitted a PAS, Prior Approval Supplement, for the KHINDIVI label expansion, initiated the ET-700 pilot study, began preparations for the Increlex label harmonization study, and also received Fast Track designation for Amglidia. Starting with the financials, it was another record quarter for Eton. Revenue reached $37.6 million, an increase of 99% year-over-year. HEMANGEOL had an exceptional relaunch quarter and was the largest contributor to our growth. Importantly, the strength was broad-based with continued momentum across our pediatric endocrinology franchise and Galzin. Based on our strong second quarter performance and favorable outlook for the remainder of the year, we are once again raising our 2026 revenue guidance. We now expect full-year revenue to exceed $145 million, up from our previous guidance of more than $120 million. Profitability has always been a core focus at Eton, and that was apparent in our results this quarter. Adjusted EBITDA increased to $16.2 million or 43% of revenue, compared with $3.6 million or 16% of revenue in the prior year quarter. Even after new incremental expenses related to the ASN-001 transaction, which I will discuss in detail shortly, we now expect our full-year adjusted EBITDA margin to exceed 35%, up from our prior guidance of greater than 30%. For the last several years, we've talked about the scalability and operating leverage inherent in our model. We're now seeing that play out in the financial results. As we continue to grow revenue, we expect an increasing proportion of that growth to translate into earnings. Longer term, we continue to believe this business can generate an adjusted EBITDA margin above 50%. Turning to our product portfolio. I'll start with the dermatology, pediatric dermatology, which has quickly become an important new franchise for Eton. We relaunched HEMANGEOL as planned on May 1st, and the product is performing ahead of our expectations. Historically, approximately 8,000 patients annually were treated with HEMANGEOL, and the patients accessed the product through 18 different pharmacies. When we acquired HEMANGEOL, we saw a significant opportunity to streamline and improve that experience by moving patients to a single high-touch access model through Eton Cares, reducing patient out-of-pocket costs, accelerating access to medication, and providing 24/7 patient support. Transitioning an entire patient population to a new distribution model was a significant operational undertaking, particularly given the nature of infantile hemangioma treatment, where therapy typically lasts only about six months. We weren't simply transitioning a static patient population. We were simultaneously converting existing patients, onboarding newly diagnosed infants, and supporting patients completing therapy, all while introducing physicians and their office staff to an entirely new access and fulfillment model. We originally expected that transition to take three to four months. I'm very proud of our team's execution. By the end of June, we estimate that approximately 95% of patients had transitioned to the new model well ahead of our expectations. Critically, this was accomplished while maintaining continuity of care for patients and their families. Today, every HEMANGEOL patient has access to the full Eton Cares patient support program. Previously, many families were paying approximately $55 per bottle, which in some cases could total more than $100 per month. Our goal is simple. Families dealing with infantile hemangioma shouldn't also have to worry about whether they can afford the medication their child needs. With the transition of existing patients largely behind us, our commercial attention is now shifting to the broader opportunity, helping ensure that more infants for whom HEMANGEOL is appropriate receive a therapy specifically developed and approved for infantile hemangioma, instead of relying on off-label adult formulations. Those off-label products were not developed for infantile hemangioma and contain excipients such as alcohol, sugar, and other ingredients that are not appropriate for infants. In our conversations with physicians, we have consistently heard that the historical out-of-pocket cost of HEMANGEOL was one factor contributing to off-label prescribing. With Eton Cares and our $0 copay program now in place, we believe we have removed an important barrier to broader adoption and are well-positioned to drive continued growth. We are extremely pleased with the HEMANGEOL acquisition. It has quickly become our largest product and established Eton as a leader in the infantile hemangioma space. As we have spent more time with pediatric dermatologists, vascular anomaly specialists, and families, it has become clear that HEMANGEOL addresses only part of the treatment landscape. For severe hemangiomas requiring treatment, HEMANGEOL is the established standard of care, and we estimate that population to be approximately 10,000 to 15,000 patients annually. Infantile hemangiomas affect more than 100,000 patients annually in the United States and exist across a broad spectrum of severity. This means that a significant number of infants with moderate infantile hemangiomas, we estimate 10,000 annually, are being treated off-label with ophthalmic timolol because there simply is not an FDA-approved topical therapy available. These timolol ophthalmic products were developed for glaucoma, not infantile hemangiomas, and present a number of practical limitations, including variable dosing, formulation challenges, the absence of FDA-approved labeling, and reimbursement limitations. To us, that represented both a clear unmet need, and we saw firsthand the evidence that physicians and families are looking for a better option. That is what ultimately led us to ASN-001, which was specifically developed for infantile hemangiomas and is supported by clinical data. There are several reasons we are particularly excited about ASN-001. First, the potential patient population could be two to three times larger than HEMANGEOL. Second, ASN-001 is expected to be prescribed by the same healthcare professionals as HEMANGEOL, allowing us to leverage our existing commercial infrastructure and the strong relationships we have already been building with thought leaders in vascular anomaly centers. Third, as a new product launch, ASN-001 would not be subject to certain rebate dynamics that weigh on HEMANGEOL's gross to net. As a result, we believe ASN-001 will likely have more favorable net pricing economics for Eton. Put those factors together and we believe ASN-001 has a clear path to becoming the largest product in our portfolio. To be clear, we expect ASN-001 to complement HEMANGEOL rather than compete with it. The two products address different segments of the disease spectrum and together would allow Eton to support physicians treating infantile hemangiomas across a much broader range of patients. With ASN-001 in our portfolio, we believe the addressable market could expand to approximately 20,000-30,000 patients annually. From a development standpoint, ASN-001 has already completed a phase III trial that showed compelling efficacy compared with placebo. Our final remaining development requirement is a bioavailability bridging study, which we plan to initiate in the coming weeks. The proposed study protocol has been reviewed by the FDA and consists of a 24-patient, 29-day study assessing the pharmacokinetics of ASN-001, and we expect that study to cost approximately $4 million over the next 12 months. Following completion of the study, we expect to be ready to submit the NDA in the second half of 2027, allowing for a potential approval and launch in 2028. We believe the ASN-001 transaction, together with the HEMANGEOL acquisition earlier this year, demonstrates two defining aspects of Eton's strategy and capabilities. First is our ability to identify and execute highly strategic, potentially transformational transactions. at the end of 2024, Increlex represented a transformational acquisition and became our largest product. Now, in just the last 6 months, we have acquired and successfully integrated what has become our largest revenue-generating product while also adding what we believe is now our highest value pipeline program. We have accomplished both without external financing and while expanding profitability. We believe that combination demonstrates the strength of our business model and our disciplined approach to capital allocation. We will continue pursuing commercial and development stage transactions that we believe can accelerate revenue and earnings growth and create significant long-term value for our shareholders. The second defining capability is what we believe to be one of Eton's greatest competitive advantages, our ability to thoughtfully enter new therapeutic areas and rapidly build leadership positions by leveraging the commercial capabilities we have already established. Pediatric dermatology is a great example. We entered the market with HEMANGEOL on May 1st. Just 90 days later, we expanded that franchise with ASN-001, a product that can leverage the same commercial organization, customer relationships, and foundational infrastructure. We have successfully executed this playbook before. We entered pediatric endocrinology with ALKINDI SPRINKLE and then expanded that platform with three additional high-value commercial products in the specialty. Similarly, we entered metabolics with Carglumic Acid and subsequently expanded the platform through additional transactions. Importantly, we have been able to build these franchises while continuing to grow our existing portfolio and maintaining discipline around operating expenses. We have proven this is a repeatable strategy and one that Eton is particularly well-positioned to execute. We expect to enter a number of new specialties in the coming years. Ultimately, our mission is simple: bring as many important rare disease therapies to patients as possible. Beyond infantile hemangioma, we have had a number of important developments across our commercial and development stage products. We will not have time to cover all of them this afternoon, but I will highlight several of the most significant, and I will start with our high-performing pediatric endocrinology portfolio. Our adrenal franchise of ALKINDI SPRINKLE and KHINDIVI continues to deliver the reliable, steady growth we have seen for more than five years. We have now exceeded 600 active patients and continue to grow. Last week, we announced that our new KHINDIVI formulation successfully demonstrated bioequivalence to the reference product, ALKINDI SPRINKLE. As a result, we were able to submit our Prior Approval Supplement, requesting approval of a broader age range. KHINDIVI is currently approved for patients five years of age and older. We continue to believe expanding the label to include patients under five would be an important catalyst for broader adoption and accelerate our path toward our goal of 1,000 active patients. We expect the expanded label to be approved in the first half of 2027. We also launched DESMODA at the end of the first quarter and have been very encouraged by the early response from the endocrinology community, who are glad to have the option of an oral liquid desmopressin solution to enable individualized dosing. Desmopressin dosing can vary significantly from patient to patient and often requires multiple dose adjustments throughout the treatment journey. DESMODA was specifically designed to address that need through precise, flexible dosing, and that differentiation is resonating strongly with clinicians. Beyond the launch itself, DESMODA is also helping us establish relationships with adult endocrinologists, expanding our commercial reach beyond our traditional pediatric call point. We are continuing to invest in peer-to-peer education, engage key opinion leaders, and build awareness through national and regional medical meetings, which include a strong presence at the Endocrine Society annual meeting in June. These activities are supporting the DESMODA launch while also strengthening our broader endocrinology platform and creating opportunities across ALKINDI SPRINKLE, KHINDIVI, and Increlex. Increlex also delivered strong year-over-year revenue growth during the quarter, and we continue to advance our label harmonization study, which we believe could substantially expand the product's long-term market opportunity. The FDA has signed off on our study protocol, and we have executed an agreement with a leading CRO to initiate the study. Our team is now actively engaged in study start-up activities with the goal of dosing the first patient by the end of the year. Rounding out our pediatric endocrinology portfolio is Amglidia. We recently received Fast Track designation from the FDA, which is designated or designed to facilitate the development and expedite the review of drugs intended to treat serious conditions and fill an unmet medical need. Amglidia is a liquid glyburide product used to treat neonatal diabetes, an extremely rare condition affecting only a few hundred children in the United States. While the product is approved and widely used in Europe, there is currently no approved oral treatment for neonatal diabetes in the United States. We are initiating the product's bioavailability study this month and plan to submit the NDA by the end of the year, allowing for potential approval and launch in 2027. Given the Fast Track designation, we intend to request priority review with our NDA submission. Now, moving on to our Wilson disease franchise. Galzin once again delivered strong revenue growth during the quarter as we continue to convert patients who have historically relied on over-the-counter zinc products. Despite the progress we've made since the relaunch, we believe we have converted less than half of the patients currently managed with zinc therapy. That leaves a substantial opportunity for continued growth. We're continuing to strengthen the franchise through our strategic partnership with the Wilson Disease Association, deeper engagement with leading centers of excellence, and expanded participation at hepatology congresses. Combined with the differentiated support offered through Eton Cares, we believe these investments position Galzin well ahead for sustained growth. Longer term, we see an opportunity to further expand our Wilson disease franchise with ET-700, our proprietary patent-pending extended-release formulation of zinc acetate. Our pilot study is currently ongoing. It is a double-blind, placebo-controlled clinical trial involving 36 healthy volunteers. The study will use PET scans with radioactive tracer copper to compare the effects of Galzin, ET-700, and placebo on intestinal copper absorption. We expect initial results in the next month or two, with the full study report expected by the end of the year. If successful, the pilot study would support the initiation of a pivotal clinical study in early 2027. If ultimately approved, we believe ET-700 could potentially exceed $100 million in peak annual U.S. sales. Lastly, I'll finish the portfolio discussion with another recent addition, IMPAVIDO. IMPAVIDO is the only FDA-approved oral therapy for severe forms of leishmaniasis, a rare but potentially life-threatening parasitic disease that could cause severe skin lesions, disfiguring mucosal disease, or life-threatening visceral infection. As a life-saving treatment for an ultra-rare condition, IMPAVIDO was a strong strategic fit for Eton, and we believe patients will benefit from expanded access through our Eton Cares program. Eton will also begin distributing the product in the U.S. in late September, and we expect IMPAVIDO to be another strong addition to our growing portfolio of orphan therapies. At the beginning of this year, we laid out three ambitious long-term goals for Eton. First, to exit 2027 at a $200 million annualized revenue run rate. We now believe that Eton is well ahead of this goal. Second, to achieve a 50% adjusted EBITDA margin in 2028. As noted, we have already exceeded 40% in the second quarter this year. Third, to reach $500 million in annual revenue by 2030. Clearly, with the addition of ASN-001, Eton expects to achieve or exceed this goal. Following our first-half performance, the successful HEMANGEOL relaunch, the addition of ASN-001, and the continued strength of our broader portfolio, we believe we are well positioned to sustain momentum into the future. Just as importantly, our recent success has put Eton in an even stronger position to continue pursuing value-creating business development opportunities. Our commercial track record has demonstrated to potential partners that Eton can be an excellent partner for commercializing ultra-rare disease products in the United States. Our growing profitability has expanded our financial capacity, allowing us to pursue a broader range of transactions, including potentially larger opportunities. We remain incredibly excited about Eton's future. We believe we are still in the early stages of building the leading rare disease company in the United States, and our mission remains unchanged: To bring as many important therapies as possible to patients with rare diseases while creating significant long-term value for our shareholders. With that, I'll turn it over to Judy Matthews, our Chief Financial Officer, to discuss our financial results. Judy? Judy Matthews: Thank you, Sean. Second quarter revenue increased 99% to $37.6 million compared to $18.9 million in the second quarter of 2025, driven by the addition of HEMANGEOL, as well as strong year-over-year growth from Increlex, ALKINDI SPRINKLE, KHINDIVI, Galzin, and Carglumic Acid. Gross profit for the quarter was $25.4 million compared to $11.9 million in the prior year period, an increase of 113%, primarily driven by higher product sales. Adjusted gross profit, which excludes the impact of acquired inventories, step-up adjustments, and intangible amortization, was $27.4 million in the second quarter of 2026, representing an adjusted gross margin of 73%. This compares to adjusted gross profit of $14.1 million, an adjusted gross margin of 75% in the prior year period. The decrease in adjusted gross margin was primarily attributable to higher Increlex sales outside the U.S., which generate a negative gross margin. We expect full-year adjusted gross margin to exceed 70%, inclusive of a potential commercial milestone expected to be recorded in the fourth quarter of 2026 upon achievement of certain net sales thresholds for ALKINDI SPRINKLE and KHINDIVI. R&D expenses for the quarter were $1 million compared to $3.7 million in the prior year period. The decrease was primarily due to the DESMODA FDA filing fee incurred in 2025. We expect full-year R&D spending to be between $10 million and $14 million, including the $3 million upfront licensing payment for ASN-001, which we expect to expense as R&D in the third quarter of 2026. General and administrative expenses for the quarter were $11.6 million, compared to $9.7 million in the prior year period, an increase of 20%. On an adjusted basis, which excludes the impact of share-based compensation, transaction-related costs and other one-time expenses, G&A expense was $10.2 million compared to $7.6 million in the prior year period. The increase was primarily driven by additional headcount to support the growth of our business, with FDA fees accounting for $0.9 million of the year-over-year increase. Adjusted EBITDA for the second quarter of 2026 was $16.2 million or 43% of revenue, compared to $3.1 million or 16% of revenue in the prior year period. We expect our full year adjusted EBITDA margin to exceed 35%, even after the potential commercial milestone referenced above and R&D expenses related to the ASN-001 licensing payment and bioavailability study. Total company net income was $11.6 million or $0.35 per diluted share, compared to a net loss of $2.6 million or $0.10 per basic and diluted share in the prior year period. On a non-GAAP basis, we reported net income of $14.3 million for the second quarter of 2026, compared to $1.5 million in the prior year period. Diluted earnings per share were $0.43 compared to $0.03 per share in the prior year period. Through the second quarter of 2026, we maintained a full valuation allowance against our net deferred tax assets. While our operating results have improved significantly, we remained in a cumulative loss position at quarter end for purposes of our valuation allowance assessment. If we continue to execute against our current forecasts and exit this cumulative loss position during the second half of 2026, we may determine that some or all of the valuation allowance is no longer necessary. As of June 30, 2026, our valuation allowance was approximately $22 million. If the valuation allowance is released in a future period, the release would result in a significant one-time non-cash income tax benefit and a corresponding increase in reported GAAP net income in the period in which it is recorded. We ended the second quarter with $26.8 million in cash on hand after making a $3 million prepayment on our outstanding debt. We remain in a strong financial position and expect cash generated from operations to grow throughout the second half of the year. We will continue to prioritize the use of our cash reserves to fund accretive product acquisitions while accelerating the repayment of our remaining credit facility over the next 6-12 months. This concludes our remarks on second quarter results. With that, we will turn the call back over to the operator for Q&A. Operator: Thank you. If you'd like to ask a question, please press star one. If your question has been answered and you'd like to remove yourself from the queue, press star one again. Our first question comes from Chase Knickerbocker with Craig-Hallum. Your line is open. Chase Knickerbocker: Great. Good afternoon. Thanks for taking the questions and congrats on a really great quarter here. Sean Brynjelsen: Thank you. Chase Knickerbocker: Maybe just first from me on HEMANGEOL. Can you give us a sense for what the net realized price is in the quarter now that we have a couple of months under our belt? How does that compare to the $8,000-$10,000 per treated patient for a full course of therapy that you had previously expected? Then if you could give us a sense for volume. We had a sense for the patients that were on drug prior to the purchase. Is that pretty comparable in 95% of the patients who were on prior were retained, and we should be thinking about that volume going forward? Thanks. David Krempa: Chase, on the net pricing, we are still sticking with that $8,000-$10,000 net price. On average, we think that is going to be our best estimate. It moves around month to month, especially during this transition, based on patient mix, but we still think it will be more or less in that $8,000-$10,000 range. In terms of patient volume, yes, historically, there has been 8,000 patients. We think we have converted all the patients now. We had 95% by end of June. We think we have got them all now. Now the commercial team's focus is on trying to grow that volume and convert some of the patients that historically have used the off-label adult product. That will be the game plan going forward. Chase Knickerbocker: Got it. Maybe just to follow up there is a six-month turnover, obviously, in these patients as they roll off therapy. Can you just speak to the efforts on getting in front of all of those providers now that the HEMANGEOL is under Eton ownership and the success of how many of those physicians, those writers that you have been able to get in front of and capture scripts subsequent to the change in ownership? Then second, just on ASN-001, could you just outline exactly the FDA feedback that your partner got around the bioavailability bridging study? Is that what is going to be considered the registrational study by FDA, or are they taking that clinical study in China into consideration as supportive evidence? Thanks. Sean Brynjelsen: Hi, Chase. I will take that last question you have, and then Ipek can take the first part. For ASN-001, this is the only study we need to run before we file it. The rest of the dossier is largely complete. You can think of it almost as a bio. It is not exactly a bioequivalency study, but it is a demonstration that our product has absorption characteristics similar to a comparative product that is in the market today, and basically demonstrating that the absorption and metabolism of the molecule through the body is similar. We view it as very straightforward and low risk. We are highly confident that we will be filing that product around the middle of next year. As we said in our earlier communications, we believe that product will be a very large product for the company, likely its largest product. Operator: Thank you. Ipek Trinkaus: Chase, hi. Ipek here. For the first part of your question on HEMANGEOL, I think a few things to note there for the kind of- Operator: Thank you. Our next question comes from Gary Nachman with Canaccord Genuity. Your line is open. Denis Reznik: Hey, guys. This is Denis Reznik on for Gary Nachman. Thanks for taking our questions, and congrats on the really strong quarter. Just starting with the recent acquisition of ASN-001, just talk a little bit more about the synergies you expect to leverage with the HEMANGEOL franchise and how much of the infrastructure there could help out this product once approved. On the IMPAVIDO acquisition, the product's been available since 2016, so maybe just talk about what you know about the market already and what you plan to do differently to ensure commercialization and growth and how big this product could get. I've got one follow-up. Operator: Ladies and gentlemen, please stand by. Ladies and gentlemen, please stand by. We're experiencing technical difficulties. Denis Reznik: Hello? Operator: You may begin. Gary, please repeat the question. Denis Reznik: Hey, guys. This is Denis Reznik on for Gary Nachman. Thanks for taking our question, and congrats on the really strong quarter. So just starting with the recent acquisition of ASN-001, can you just talk a little bit more about the synergies you expect to leverage with the HEMANGEOL franchise and how much of the infrastructure there could help out once this product is approved? Then on the recent acquisition of IMPAVIDO, the product has been available since 2016, so maybe just talk about what you already know about the market, then what you plan to do differently to ensure commercialization and growth and how big this product can get. I have got one follow-up. Sean Brynjelsen: Sure. So on ASN-001, we are very excited about the product. We believe we will file it in the middle of next year. It will leverage our existing hemangioma sales team. We think this product is an ideal fit for the company. It is also a demonstration of our commitment to really supporting the hemangioma community. The product is expected to be our largest revenue-generating product when we launch it, likely in 2028. Regarding IMPAVIDO, Ipek, why don't you take that one? Ipek Trinkaus: Sure. So I think if you look at the previous commercialization before our time, before our acquisition, it was basically distributed by a single-person distributor structure. So there was no field sales force on the ground actually talking to these infectious disease experts and specialists. There are many levers that we are going to pull. Also, it was not covered traditionally by Medicaid. The distribution was quite dispersed in the sense that it was relatively difficult for patients to figure out what pharmacy to get the product. There was obviously not a co-pay support in place. So we think that we are going to pull many of those levers and really bring meaningful value to both the prescribers and the patients. We already know the targets. It is a very nice fit in terms of a very concentrated target space. It is going to be around 300 Salesforce targets. We're very much in a concentrated capacity that manage the leishmaniasis. We are pretty confident that with our specialist sales force, we are going to get to those infectious disease specialists. Obviously, the guidelines and the therapy profile supports as it is the only FDA-approved product for the therapy. Then we are putting it into our Eton Cares model, where these providers and patients will know where to get the product, get the $0 copay support. We are obviously going to be able to cover the Medicaid patients that actually need the government coverage, and hopefully, we'll be in a much better place in terms of the patient and provider experience. Denis Reznik: That's super helpful. Thank you. Then just on the quarterly results, just any more color you can give about how much upside the HEMANGEOL launch provided this quarter, and how should we be thinking about sequential growth for that product moving forward? Then any color you can give about how the launch of DESMODA helped in this quarter, particularly. That answers my questions. Thanks so much. Sean Brynjelsen: Sure. We're not going to give product-specific guidance as we haven't done that in the past. But I can tell you that we believe there's significant growth opportunity on HEMANGEOL. This is one where the patient support and the Eton Cares service adds a lot of value that wasn't there previously. Also, obviously, with the much lower copay, we think that patients will be less likely to use off-label product and will stay on HEMANGEOL, as well as be prescribed it to a greater extent. Ultimately, the annual patients should be exceeding 10,000 a year. Regarding your question about the DESMODA impact, launch is going well, but from a financial standpoint, it was only its first full quarter on the market. It wasn't a huge contributor to the growth that you saw in Q2. But as we exit this year, we expect to start seeing a meaningful contribution from that product that will drive our long-term growth as we get to some of those peak sales numbers we talked about for the product. Denis Reznik: Thanks so much. Congrats on the quarter. Sean Brynjelsen: Thank you. Operator: Thank you. Our next question comes from Madison El-Saadi with B. Riley Securities. Your line is open. Madison, if you're muted, please unmute. Madison El-Saadi: Yes. Thank you. Congrats on the quarter, guys, and thanks for taking the question. It sounds like much of the 2Q beat here came from HEMANGEOL. How much of the $25 million raised guide is HEMANGEOL versus everything else? Sean Brynjelsen: Thanks for the question, Madison. As I said previously to a similar question, we are not going to break out our products, as we generally haven't done that in the past. I think that from a go-forward standpoint, I can say that we expect HEMANGEOL to continue to grow. As was indicated, we've largely completed all the conversions from the old pharmacies to the new pharmacy system, so the patient conversion process is complete. We are now looking to grow that business, and it is growing. Actually, we are really encouraged by the product. We think it still has a lot of runway. More importantly, we are super excited about ASN-001 late-stage product that will fit in perfectly with our pediatric dermatology sales team. That's a product that's been a patient request and a doctor request for a long time, that will certainly fit well, and we hope to launch that in the next 12-20 months. Madison El-Saadi: Got it. Thank you. If I may, a quick follow-up. Has your thinking on DESMODA peak opportunity, has that changed? Now, your sales team, KHINDIVI, Increlex, multiple options in the bag here. I guess, at what point does the team need to get bigger? Thanks. Ipek Trinkaus: Thank you, Madison. I think in terms of the DESMODA peak opportunity at this point, we will keep it the same with our guidance from the past. I think we said around $40 million-$50 million as our peak number. So we will still keep it at the same. It's been a very encouraging first five months. Actually, in terms of the patient adds, we are around 115% of targets. From a, again, how fast we are going to get there, it's too early to tell. But the clinician feedback and current patient build has been very much encouraging. But we will keep our guidance and the proportion to the peak size the same. In terms of the sales force size, I think at this point, ALKINDI and KHINDIVI being basically adrenal insufficiency franchise, so they are really addressing the same condition. So we are approaching that as a portfolio sale. Increlex, as you know, is a very much ultra-rare specialty sales. The great thing here is when you look at the prescribers, obviously they are all endocrinologists, but there is also a very strong over 90% overlap, even though some endocrinologists are specialists in certain diseases. I think at this point, we are not planning any expansion of the sales force. We think that our infrastructure is pretty much sufficient and effective for the current portfolio. Madison El-Saadi: Got it. Thank you. Operator: Thank you. Our next question comes from RK with H.C. Wainwright. Your line is open. RK Swayampakula: Thank you. Good evening, Sean and team. Excellent quarter. Congratulations on that. I know a lot of my questions have been asked. In general, just trying to understand how you plan on having ASN-001 and HEMANGEOL work out that franchise, especially with HEMANGEOL patent running out in October 2028, I believe. Is there any way for you to extend that, or is ASN-001 the answer for that? Sean Brynjelsen: Thank you for the question, RK. The HEMANGEOL formulation, I would say has some aspects which can be improved, so we're looking at some formulation improvements, which we think will be better for the patients and certainly for the caregivers. We'll get into that a little later. There is an opportunity there to add some IP in addition. I would say that for ASN-001, that has a very, obviously, long runway in terms of patent protection. That market is several orders larger than HEMANGEOL. I'd say that if you look at HEMANGEOL as something that is used to treat the severe hemangiomas and ASN-001 will have 20,000-30,000, we believe, at a minimum number of patients. FDA believes there's more than 200,000 patients that have hemangiomas in the United States. But we're giving it a nice haircut to make sure that we're giving it as accurate guidance as we can. But we believe the number could be significant. That will certainly be a large product for us. We'll continue to do M&A and licensing and expand our pediatric dermatology franchise. When we get into a given therapeutic area, we continue to invest in it. For us, it's all about the patients. It's about building upon the treatment areas that we get involved in, and it's not a one-product kind of deal. We want to continue to build upon that. RK Swayampakula: Thanks for that. On HEMANGEOL itself, in terms of the patient economics, you have 8,000 inherited patients. But at this point, how many are paying versus free drug program? In terms of new patient acquisition rate, where are you now since you started in May? By the end of 2026, where do you think realistically could be the paying patient number? David Krempa: Hi, RK. We're not going to get into the specific breakdown of the payer mix for each patient, but we've said it's more or less coming in as we expected when we put out that $8,000 to $10,000 net number. It's more or less in the ballpark. Obviously, it jumps around a little bit month to month and the first month or two with some transitions and some bridge product, but it should stabilize here as we go forward. RK Swayampakula: Okay. Let me try on IMPAVIDO. On that molecule, you have a 50%-55% of net sales going to Knight. How much contribution does it do for your EBITDA line, and how much of the demand is there that you are actually handling at this point? David Krempa: We are launching the product end of September, so no financial impact yet. Although there is a larger profit share, it was a little bit of a unique model. We paid very little upfront, so we think it is still going to be a very attractive deal for the company. We think it will contribute multiple millions of dollars annually with very little upfront, very little resource distraction, and good complementary fit with the rare disease strategy and the Eton Cares program. It will be lower margin than some of our other products, but we think it will still be an attractive opportunity and a very attractive return on investment relative to what we put up to get the distribution rights. RK Swayampakula: Thank you. Thanks for taking my questions. Operator: Thank you. This concludes the question and answer session. You may now disconnect. Good day. Before you buy stock in Eton Pharmaceuticals, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Eton Pharmaceuticals wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. 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As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has positions in and recommends Eton Pharmaceuticals. The Motley Fool has a disclosure policy. Eton Pharmaceuticals (ETON) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Never miss an important update on your stock portfolio and cut through the noise. Over 7 million investors trust Simply Wall St to stay informed where it matters for FREE. Eton Pharmaceuticals (ETON) has become a focus for investors after its second quarter 2026 report, which showed US$37.59 million in revenue, US$11.58 million in net income, and a shift from loss to earnings per share. See our latest analysis for Eton Pharmaceuticals. The strong Q2 results and raised 2026 guidance have coincided with a sharp re-rating in Eton Pharmaceuticals, with a 1 day share price return of 44.26% helping extend its year to date share price return to 261.99%, while the 3 year total shareholder return exceeds 12x. If you are looking beyond Eton Pharmaceuticals for other healthcare opportunities with growth stories, it could be worth scanning rare disease peers and adjacent biotech through the 44 healthcare AI stocks Eton Pharmaceuticals has already delivered a sharp re-rating, yet the stock still trades below the latest analyst price target and an estimated intrinsic value. Is most of the upside already captured, or is the rerating only part way through? The most followed narrative currently places Eton Pharmaceuticals' fair value at $45.67, which is well below the last close of $58.86, so the recent surge now sits ahead of that framework and leans heavily on ambitious long term assumptions. Read the complete narrative. Want to see what sits behind that gap between current price and fair value? The narrative leans on a sharp ramp in revenue, profitability and valuation multiples. The full breakdown sets out how earnings, margins and discounting assumptions work together to support that target. Result: Fair Value of $45.67 (OVERVALUED) Have a read of the narrative in full and understand what's behind the forecasts. However, the Eton Pharmaceuticals narrative could be challenged if key orphan drugs face faster payer pushback on pricing or if ongoing clinical and regulatory milestones are delayed. Find out about the key risks to this Eton Pharmaceuticals narrative. The analyst narrative describes Eton Pharmaceuticals as 28.9% overvalued at $58.86, while the Simply Wall St DCF model indicates the stock trades at a 79.4% discount to an estimated future cash flow value of $285.41. Which set of assumptions appears more realistic to you? To examine how this cash flow driven estimate is constructed, including revenue, margin and discount rate assumptions, take a closer look at the Look into how the SWS DCF model arrives at its fair value. Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Eton Pharmaceuticals for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 50 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity. With sentiment on Eton Pharmaceuticals split between risk and reward, now is a good time to look through the data yourself and move quickly to form your own view. A helpful place to start is by weighing the company's 4 key rewards and 3 important warning signs. If you only focus on Eton Pharmaceuticals today, you could miss other opportunities where quality, income, or hidden potential line up better with your goals. Target resilience by scanning companies that pass strict balance sheet and fundamentals checks through the solid balance sheet and fundamentals stocks screener (50 results). Lock in potential income streams by reviewing businesses screened for strong yields and staying power using the 10 dividend fortresses. Spot underfollowed opportunities by checking a screener containing 18 high quality undiscovered gems before the crowd pays attention. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include ETON. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Achieved 99% year-over-year revenue growth, primarily driven by the successful relaunch of HEMANGEOL and broad-based momentum across the pediatric endocrinology franchise. Realized significant operating leverage with adjusted EBITDA margins reaching 43%, validating the scalability of the company's rare disease commercial model. Successfully transitioned 95% of HEMANGEOL patients to the Eton Cares high-touch access model within 60 days, significantly faster than the initial three-to-four-month expectation. Strategic entry into pediatric dermatology was reinforced by the licensing of ASN-001, which management believes addresses a patient population two to three times larger than HEMANGEOL. Performance attribution for the quarter includes the conversion of patients from over-the-counter zinc to Galzin and the initial commercial rollout of DESMODA. Management highlighted a repeatable 'franchise playbook' of entering a specialty with a lead product and rapidly layering in complementary therapies to leverage existing infrastructure. The acquisition of IMPAVIDO rights further diversifies the orphan portfolio, utilizing the Eton Cares platform to improve access for ultra-rare parasitic disease treatments. Raised full-year 2026 revenue guidance to exceed $145 million, up from the previous $120 million target, reflecting strong commercial execution. Anticipate full-year adjusted EBITDA margins to exceed 35%, even after accounting for incremental R&D expenses related to the ASN-001 licensing and study costs. Targeting a Prior Approval Supplement (PAS) approval for KHINDIVI label expansion in the first half of 2027 to include patients under five years of age. Expect to submit the NDA for ASN-001 in the second half of 2027 following a 24-patient bioavailability bridging study, targeting a commercial launch in 2028. Management reiterated long-term strategic goals of reaching a $200 million revenue run rate by late 2027 and $500 million in annual revenue by 2030. Reported a negative gross margin on Increlex sales outside the U.S., which contributed to a slight year-over-year decrease in adjusted gross margin to 73%. Anticipate a potential one-time non-cash income tax benefit in the second half of 2026 if the company exits its cumulative loss position, allowing for a $22 million valuation allowance release. Identified off-label use of adult formulations and ophthalmic products as a primary market headwind that the company aims to counter through its $0 copay and patient support programs. Planned R&D spending of $10 million to $14 million for the full year includes a $3 million upfront payment for ASN-001 and costs for the Increlex label harmonization study. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management confirmed net pricing remains in the $8,000 to $10,000 range per treated patient despite the transition to a new distribution model. Estimated that nearly all historical patients have now been captured under the Eton Cares model, with future growth expected from converting off-label users. The FDA has reviewed the protocol for a 24-patient bioavailability bridging study, which is the final clinical requirement before filing the NDA. Management views the study as low-risk, characterizing it as a demonstration of absorption characteristics similar to existing market products. IMPAVIDO will be integrated into the Eton Cares model to address historical gaps in Medicaid coverage and fragmented distribution. ASN-001 is expected to leverage the same pediatric dermatology sales force as HEMANGEOL, targeting the same healthcare professionals and vascular anomaly centers. Management stated that the current infrastructure is sufficient and effective for the existing portfolio, with no immediate plans for sales force expansion. Noted a 90% overlap in prescribers for the endocrinology products, allowing for an efficient 'portfolio sale' approach.

Interested in Eton Pharmaceuticals, Inc.? Here are five stocks we like better. Revenue and profitability surged: Second-quarter revenue nearly doubled to $37.6 million, while adjusted EBITDA rose to $16.2 million, or 43% of revenue. Eton raised its 2026 revenue outlook to more than $145 million and expects an adjusted EBITDA margin above 35%. HEMANGEOL drove growth and is nearing a distribution transition: Following its May relaunch, about 95% of patients had moved to Eton’s single-pharmacy access model by the end of June. Management expects annual patient volume to eventually exceed 10,000. Pipeline expansion could support long-term growth: Eton licensed late-stage hemangioma candidate ASN-001, expects to file for approval in the second half of 2027, and is advancing products including Amglidia, KHINDIVI, ET-700 and IMPAVIDO. The company continues targeting $200 million in annualized revenue by the end of 2027 and $500 million by 2030. Eton Pharmaceuticals (NASDAQ:ETON) reported second-quarter revenue nearly doubled from a year earlier, driven by the relaunch of HEMANGEOL and growth across its pediatric endocrinology and rare-disease portfolio. The company raised its full-year revenue and profitability outlook while outlining plans to advance newly acquired and internally developed products. Revenue for the second quarter of 2026 rose 99% to $37.6 million, from $18.9 million in the prior-year period. Chief Executive Officer Sean Brynjelsen said HEMANGEOL, a treatment for infantile hemangioma, was the largest contributor to growth after its May 1 relaunch. He also cited continued momentum from Increlex, ALKINDI SPRINKLE, KHINDIVI, Galzin and Carglumic Acid. → AST SpaceMobile Earnings Just Reminded Investors How Risky Space Can Be The company increased its 2026 revenue outlook to more than $145 million, up from prior guidance of more than $120 million. It also expects its full-year adjusted EBITDA margin to exceed 35%, compared with previous guidance for a margin above 30%. Adjusted EBITDA climbed to $16.2 million, or 43% of revenue, compared with $3.1 million, or 16% of revenue, in the second quarter of 2025. Net income was $11.6 million, or $0.35 per diluted share, compared with a net loss of $2.6 million, or $0.10 per share, a year earlier. → Nebius’ Q2 Beat Shows the AI Bottleneck Is Capacity, Not Demand On a non-GAAP basis, Eton reported net income of $14.3 million, or $0.43 per diluted share, versus $1.5 million, or $0.03 per share, in the prior-year quarter. Gross profit increased 113% to $25.4 million. Adjusted gross profit was $27.4 million, representing a 73% adjusted gross margin, down from 75% a year earlier. Chief Financial Officer Judy Matthews said the decline reflected higher Increlex sales outside the U.S., which carry a negative gross margin. → On Holding's Price Stumble May Be an Opening for a Company Built to Run Eton expects full-year adjusted gross margin to exceed 70%. The outlook includes a potential commercial milestone expected in the fourth quarter if certain ALKINDI SPRINKLE and KHINDIVI net-sales thresholds are met. Research and development expense was $1 million, down from $3.7 million a year earlier, primarily because the prior-year period included a DESMODA FDA filing fee. Eton now expects 2026 R&D spending of $10 million to $14 million, including a $3 million upfront licensing payment for ASN-001 that it expects to record as R&D expense in the third quarter. As of June 30, Eton held $26.8 million in cash after making a $3 million prepayment on outstanding debt. Matthews said the company expects operating cash generation to grow in the second half and plans to use cash for accretive product acquisitions and accelerated repayment of its credit facility. Eton said it had transitioned approximately 95% of HEMANGEOL patients to its Eton Cares single-pharmacy access model by the end of June, ahead of its original expectation that the process would take three to four months. Brynjelsen said the company believes it has now converted all patients from the prior distribution system. Before Eton acquired the product, about 8,000 patients annually accessed HEMANGEOL through 18 pharmacies. The new model is intended to reduce out-of-pocket costs, improve access and provide round-the-clock patient support. The company offers a $0 copay program for the treatment. Chief Business Officer David Krempa said Eton continues to estimate HEMANGEOL net pricing at $8,000 to $10,000 per treated patient for a full course of therapy. With the patient conversion largely complete, the company is focusing on increasing volume and converting patients who have historically used off-label adult formulations. Brynjelsen said Eton expects annual HEMANGEOL patient volume to ultimately exceed 10,000. He added that DESMODA, which launched at the end of the first quarter, was not a major contributor to second-quarter growth but is expected to make a more meaningful contribution as the company exits 2026. Eton recently licensed ASN-001, a late-stage topical therapy candidate for moderate infantile hemangiomas. The company said the candidate could address an estimated 10,000 patients annually who are treated off-label with ophthalmic timolol because no FDA-approved topical therapy is currently available. Management expects ASN-001 to complement HEMANGEOL, which is used for severe hemangiomas, rather than compete with it. Together, Eton estimates the two products could address 20,000 to 30,000 patients annually. ASN-001 has completed a Phase III trial, according to Eton. The remaining development requirement is a 24-patient, 29-day bioavailability bridging study that management expects to begin in coming weeks and cost approximately $4 million over the next 12 months. The FDA has reviewed the proposed protocol, Brynjelsen said. Eton expects to submit a new drug application for ASN-001 in the second half of 2027, potentially supporting approval and a launch in 2028. During the question-and-answer session, Brynjelsen said the company expects the candidate to leverage its existing hemangioma sales force and could become Eton’s largest revenue-generating product after launch. KHINDIVI: Eton submitted a Prior Approval Supplement seeking to expand the product’s approved age range to patients under age five after a new formulation demonstrated bioequivalence to ALKINDI SPRINKLE. The company expects a decision in the first half of 2027. Increlex: The FDA signed off on Eton’s label-harmonization study protocol. The company has engaged a contract research organization and aims to dose the first patient by the end of 2026. Amglidia: The FDA granted Fast Track designation for the liquid glyburide treatment for neonatal diabetes. Eton plans to begin a bioavailability study in August, submit an NDA by year-end and seek priority review, with potential approval and launch in 2027. ET-700: Eton’s pilot study of its extended-release zinc acetate formulation for Wilson disease is underway. Initial results are expected within one to two months, with a full report anticipated by year-end. If successful, the company expects to start a pivotal study in early 2027. IMPAVIDO: Eton acquired U.S. rights to the oral therapy for severe forms of leishmaniasis and expects to begin U.S. distribution in late September. Management said it plans to use a concentrated specialist sales approach, Eton Cares support, and expanded Medicaid coverage to improve patient access. Management reiterated long-term goals of reaching a $200 million annualized revenue run rate by the end of 2027, a 50% adjusted EBITDA margin in 2028 and $500 million in annual revenue by 2030. Brynjelsen said the company now believes it is ahead of its 2027 run-rate target and expects the addition of ASN-001 to support achieving or exceeding its 2030 revenue objective. Eton Pharmaceuticals, Inc is a specialty pharmaceutical company focused on developing, manufacturing and commercializing generic and proprietary pharmaceutical products for patients with rare and underserved diseases. Headquartered in West Palm Beach, Florida, the company leverages its expertise in hormone therapies and complex molecules to address treatment areas where patient need is high and competition is limited. Since its founding in 2016, Eton has sought to build a diversified portfolio that combines established generic medicines with targeted branded offerings. The company's product lineup includes thyroid hormone replacements such as desiccated thyroid and liothyronine, as well as pyrimethamine tablets indicated for toxoplasmosis. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Eton Pharmaceuticals Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

This article first appeared on GuruFocus. Release Date: August 13, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Eton Pharmaceuticals Inc (NASDAQ:ETON) achieved record second-quarter revenue of $37.6 million, a 99% year-over-year increase, driven by strong performance across its portfolio. The company significantly expanded profitability, with adjusted EBITDA reaching $16.2 million (43% of revenue) in Q2 2026, up from $3.6 million (16% of revenue) in the prior year quarter. The relaunch of Hemangiol exceeded expectations, with approximately 95% of patients transitioned to the new Eaton Cares model by the end of June, well ahead of the initial 3-4 month timeline. Eton Pharmaceuticals Inc (NASDAQ:ETON) expanded its pipeline and commercial portfolio through strategic acquisitions, including the licensing of ASN-001, a late-stage candidate for infantile hemangiomas with a potential patient population 2-3 times larger than Hemangiol. The company raised its full-year 2026 revenue guidance to exceed $145 million (up from $120 million) and expects adjusted EBITDA margin to exceed 35%, reflecting strong operational leverage and a positive outlook. Eton Pharmaceuticals Inc (NASDAQ:ETON) received fast-track designation from the FDA for Amglidia, a potential first approved oral treatment for neonatal diabetes in the U.S., and plans to submit the NDA by the end of 2026. Adjusted gross margin decreased to 73% in Q2 2026 from 75% in the prior year period, primarily due to higher Increlex sales outside the U.S., which generate a negative gross margin. The company expects to incur significant R&D expenses related to the ASN-001 licensing payment ($3 million) and its bioavailability study (approximately $4 million over the next 12 months), which could pressure near-term profitability. Eton Pharmaceuticals Inc (NASDAQ:ETON) faces execution risks in launching new products, including the upcoming U.S. distribution of Impavito in late September and the ongoing development of ASN-001, which is not expected to launch until 2028. The company's cash position stood at $26.8 million at the end of Q2 2026, which may limit its ability to pursue larger acquisitions without external financing, despite its stated ambition to expand its portfolio. The company remains in a cumulative loss position for tax purposes, and while it may release its $22 million valuation allowance in the second half of 2026, this is contingent on continued execution against its forecast. Eton Pharmaceuticals Inc (NASDAQ:ETON) faces competitive and market risks in converting patients from off-label products to its approved therapies, particularly for Hemangiol and Galzin, where less than half of the eligible patient population has been converted. Warning! GuruFocus has detected 3 Warning Sign with ETON. Is ETON fairly valued? Test your thesis with our free DCF calculator. Q: Can you give us a sense for what the net realized price is for Hemangiol in the quarter, how that compares to the $8,000 to $10,000 per treated patient expectation, and whether the 95% patient transition rate means we should think about that volume going forward?A: David Krempa, Chief Business Officer: We are still sticking with that $8,000 to $10,000 net price range on average, though it moves around month to month based on patient mix during the transition. In terms of volume, we believe we have now converted all patients to the new model, having reached 95% by the end of June. The commercial team's focus is now on growing that volume and converting patients who historically used off-label adult products. Q: Could you outline exactly the FDA feedback your partner got around the ASN-001 bioavailability bridging study? Is that what's going to be considered the registrational study by the FDA, or are they taking the clinical study in China into consideration as supportive evidence?A: Sean Brinjelson, CEO: The bioavailability study is the only study we need to run before filing. The rest of the dossier is largely complete. It's not exactly a bioequivalency study, but a demonstration that our product has absorption characteristics similar to a comparative product on the market today, showing the absorption and metabolism of the molecule is similar. We view it as very straightforward and low risk, and we are highly confident we will be filing that product around the middle of next year. Q: Just starting with the recent acquisition of ASN-001, talk a little bit more about the synergies you expect to leverage with the Hemangiol franchise and how much of the infrastructure there could help out this product once approved. And then on the Impavido acquisition, the product's been available since 2016, so maybe just talk about what you know about the market already and what you plan to do differently to ensure commercialization and growth?A: Sean Brinjelson, CEO: ASN-001 is expected to be prescribed by the same healthcare professionals as Hemangiol, allowing us to leverage our existing commercial infrastructure and the strong relationships we've already been building with thought leaders and vascular anomaly centers. As a new product launch, ASN-001 would not be subject to certain rebate dynamics that weigh on Hemangiol's gross to net, so we believe it will likely have more favorable net pricing economics. For Impavido, it's a life-saving treatment for an ultra-rare condition and a strong strategic fit. We will begin distributing the product in the U.S. in late September, and patients will benefit from expanded access through our Eaton Cares program. Q: Can you provide more color on the Hemangiol relaunch performance, specifically the transition of patients to the new Eaton Cares model and the progress on converting off-label users?A: Sean Brinjelson, CEO: The relaunch on May 1st is performing ahead of expectations. We transitioned approximately 95% of patients to the new single, high-touch access model by the end of June, well ahead of our three-to-four-month expectation. Previously, many families were paying approximately $55 per bottle, which could total more than $100 per month. With Eaton Cares and our $0 copay program now in place, we believe we've removed an important barrier to broader adoption and are well positioned to drive continued growth by converting patients using off-label adult formulations. Q: Given the strong second quarter performance, can you provide more detail on the full-year guidance raise and the drivers behind the significant margin expansion?A: Judy Matthews, CFO: Second-quarter revenue increased 99% to $37.6 million, driven by the addition of Hemangiol and strong growth across Increlex, Alkindi Sprinkle, Kinduvi, Galzin, and Carglumic Acid. Adjusted EBITDA increased to $16.2 million, or 43% of revenue, compared to $3.6 million, or 16% of revenue, in the prior year quarter. We are raising our 2026 revenue guidance to exceed $145 million, up from previous guidance of more than $120 million, and we now expect full-year adjusted EBITDA margin to exceed 35%, up from prior guidance of greater than 30%. Q: Can you provide an update on the Kinduvi label expansion and the progress of the Increlex label harmonization study?A: Sean Brinjelson, CEO: We announced that our new Kinduvi formulation successfully demonstrated bioequivalence to the reference product, Alkindi Sprinkle, and we submitted a prior approval supplement requesting approval of a broader age range. We expect the expanded label to be approved in the first half of 2027. For Increlex, the FDA has signed off on our study protocol, and we have executed an agreement with a leading CRO. Our team is actively engaged in study startup activities with the goal of dosing the first patient by the end of the year. Q: Can you provide an update on the ET-700 pilot study and the potential market opportunity for this product?A: Sean Brinjelson, CEO: Our pilot study is currently ongoing. It is a double-blind, placebo-controlled clinical trial involving 36 healthy volunteers using PET scans with radioactive tracer copper to compare the effects of Galzin, ET-700, and placebo on intestinal copper absorption. We expect initial results in the next month or two, with the full study report expected by the end of the year. If successful, the pilot study would support the initiation of a pivotal clinical study in early 2027. If ultimately approved, we believe ET-700 could potentially exceed $100 million in peak annual U.S. sales. Q: Can you provide an update on the Amglidia program and the significance of the fast-track designation?A: Sean Brinjelson, CEO: We recently received fast-track designation from the FDA, which is designed to facilitate the development and expedite the review of drugs intended to treat serious conditions and fill an unmet medical need. Amglidia is a liquid glyburide product used to treat neonatal diabetes, an extremely rare condition affecting only a few hundred children in the U.S. We are initiating the product's bioavailability study this month and plan to submit the NDA by the end of the year, allowing for potential approval and launch in 2027. Given the fast-track designation, we intend to request priority review with our NDA submission. Q: Can you provide an update on the Desmoda launch and how it's expanding your commercial reach?A: Sean Brinjelson, CEO: For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Eton Pharmaceuticals, Inc. (ETON) came out with quarterly earnings of $0.35 per share, beating the Zacks Consensus Estimate of $0.11 per share. This compares to a loss of $0.1 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +218.18%. A quarter ago, it was expected that this company would post earnings of $0.1 per share when it actually produced earnings of $0.05, delivering a surprise of -50%. Over the last four quarters, the company has surpassed consensus EPS estimates just once. Eton Pharmaceuticals, which belongs to the Zacks Medical - Biomedical and Genetics industry, posted revenues of $37.59 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 38.12%. This compares to year-ago revenues of $18.93 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Eton Pharmaceuticals shares have added about 145.9% since the beginning of the year versus the S&P 500's gain of 13.2%. While Eton Pharmaceuticals has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Eton Pharmaceuticals was unfavorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #5 (Strong Sell) for the stock. So, the shares are expected to underperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.16 on $30.72 million in revenues for the coming quarter and $0.67 on $120.16 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Medical - Biomedical and Genetics is currently in the bottom 39% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Eton Pharmaceuticals, Inc. (ETON) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Record revenue, with Q2 2026 product sales of $37.6 million, representing 99% growth over Q2 2025 Q2 2026 fully diluted GAAP EPS of $0.35, non-GAAP fully diluted EPS of $0.43; EBITDA of $14.1 million, Adjusted EBITDA of $16.2 million Raising full year revenue guidance, with 2026 revenue now expected to exceed $145 million, up from previous guidance of more than $120 million Relaunched HEMANGEOL® May 1st, patient conversion completed ahead of schedule Acquired late-stage product candidate ASN-001, expanding the Company’s infantile hemangioma franchise, and providing a potential high-value 2027 NDA submission Submitted Prior Approval Supplement to the FDA to expand indication of KHINDIVI®, allowing for potential H1 2027 approval of expanded indication Received FDA Fast Track designation for endocrinology development product AMGLIDIA® Acquired U.S. commercialization rights to orphan drug IMPAVIDO® Management to hold conference call today at 4:30pm ET DEER PARK, Ill., Aug. 13, 2026 (GLOBE NEWSWIRE) -- Eton Pharmaceuticals, Inc (“Eton” or “the Company”) (Nasdaq: ETON), an innovative pharmaceutical company focused on developing and commercializing treatments for rare diseases, today reported financial results for the quarter ended June 30, 2026. “Eton reported another outstanding quarter, delivering 99% year-over-year revenue growth, reflecting the strength of our rare disease portfolio and the exceptional execution of our team. Our HEMANGEOL relaunch is off to a strong start, with the patient conversion completed ahead of schedule, positioning our therapy for continued momentum and furthering our mission to allow more infants with infantile hemangiomas to benefit from timely treatment. In addition, we further expanded our commitment to the infantile hemangioma community with the licensing of ASN-001, an exciting late-stage development program that is expected to further improve care and broaden treatment options for families, while potentially becoming the largest revenue opportunity in our pipeline. The rest of our portfolio continued to deliver in the quarter, with strong contributions from our entire pediatric endocrinology franchise, including the recently launched DESMODA™, and our metabolic products,” said Sean Brynjelsen, CEO of Eton Pharmaceuticals. “Given our first half performance and strong outlook for the remainder of the year, we’re pleased to again raise our annual revenue guidance and now expect at least $145 million of revenue this year. We are also raising our adjusted EBITDA guidance, which includes the additional expenses related to the ASN-001 transaction and development. We now expect to deliver an Adjusted EBITDA margin of at least 35%,” concluded Brynjelsen. Second Quarter and Recent Business Highlights Record revenues with 99% growth year-over-year. Eton reported second quarter 2026 revenues of $37.6 million, compared to $18.9 million in the prior year period, driven by the addition of sales from HEMANGEOL plus strong growth from across the portfolio. HEMANGEOL relaunched successfully, ensuring continuity of care for patients and families. The Company relaunched HEMANGEOL in May, offering full Eton Cares patient support, which provides comprehensive access and affordability services including $0 copay for all eligible patients. The transition to Eton’s program exceeded expectations, with approximately 95% of existing patients successfully transitioned by the end of June. Expanded presence in infantile hemangioma with licensing of product candidate ASN-001. Last week, Eton announced the licensing of product candidate ASN-001, which is under development for the treatment of moderate infantile hemangiomas. ASN-001 would complement Eton’s HEMANGEOL franchise and leverage the same commercial infrastructure. The Company plans to initiate a bioavailability study and anticipates a New Drug Application (“NDA”) submission upon the study’s completion in the second half of 2027. If approved, Eton believes ASN-001 offers the largest revenue opportunity in its pipeline. Strong year-over-year growth in pediatric endocrinology portfolio. DESMODA, which launched in March, continues to see strong adoption and patient growth while the three other products in the Company’s pediatric endocrinology portfolio all posted strong year-over-year revenue growth in the second quarter. The Company's adrenal franchise, consisting of ALKINDI SPRINKLE and KHINDIVI, surpassed 600 active patients on therapy, reflecting continued confidence from pediatric endocrinologists. INCRELEX continued to deliver strong growth, driven by appropriate dose optimization and sustained treatment, reflecting the Company's commitment to helping patients achieve the best possible outcomes. Completed KHINDIVI label expansion study and submitted Prior Approval Supplement (PAS) to the U.S. Food and Drug Administration (FDA) requesting expansion of indication. The new formulation of KHINDIVI successfully demonstrated bioequivalence to ALKINDI SPRINKLE, paving the way for a potential first half of 2027 approval. The Company believes the largest unmet need for an FDA-approved oral liquid hydrocortisone remains with children under age five, and that an expanded label would dramatically increase adoption. Acquired exclusive U.S. commercialization rights to Orphan Drug IMPAVIDO. In June, Eton announced the acquisition of IMPAVIDO, a critical, life-saving medication, adding an additional 2026 product launch. The product is FDA-approved, and Eton expects to begin commercializing the product in September 2026. Pediatric endocrinology development product candidate AMGLIDIA was granted Fast Track designation by FDA. The Fast Track designation is designed to facilitate the development and expedite the review of drugs to treat serious conditions and fill an unmet medical need. The Company plans to initiate a bioavailability study for the product later this month and remains on track to submit an NDA by the end of 2026, allowing for potential approval and launch in 2027. Continued to advance Wilson disease franchise. In addition to a strong quarter of patient additions for GALZIN, the Company’s pilot study for product candidate ET-700, its proprietary, patent-pending, extended-release formulation of zinc acetate, is underway. The study is comparing ET-700 to GALZIN and placebo. If pilot study results are successful, Eton anticipates initiating a pivotal clinical study in early 2027. Executed INCRELEX label harmonization study agreement with Clinical Research Organization; site preparation is underway. Earlier this year, Eton received clearance from the FDA to proceed with its proposed label harmonization study, designed to support an application to broaden the approved definition of severe primary IGF-1 deficiency (SPIGFD) to match the E.U. definition. If successful, this could increase the addressable population in the U.S. from an estimated 200 to 1,000 patients. The Company has initiated study preparation activities with a goal of having the first patients dosed by the end of 2026. Guidance The Company now expects 2026 revenues to exceed $145 million, an increase from prior guidance of more than $120 million. In addition, the Company now expects to report at least a 35% Adjusted EBITDA margin, an increase from prior guidance of at least 30%. The revised Adjusted EBITDA guidance is inclusive of a $3 million licensing payment for ASN-001 which will be expensed in the third quarter, incremental second half R&D expenses related to ASN-001’s bioavailability study, and a potential, one-time $4 million commercial milestone payment related to ALKINDI SPRINKLE sales performance, which may be triggered in the fourth quarter of 2026. Second quarter Financial Results Net Revenue: Total net revenue for the second quarter of 2026 was $37.6 million compared to $18.9 million in the prior year period, an increase of 99%, driven by the addition of revenue from HEMANGEOL, as well as year-over-year growth across the portfolio, in particular INCRELEX, ALKINDI SPRINKLE, GALZIN and Carglumic Acid. Second quarter 2026 revenue included $2.9 million of revenue from INCRELEX and GALZIN sales outside the United States. Gross Profit: Gross profit for the second quarter of 2026 was $25.4 million compared with $11.9 million in the prior year period, an increase of 113%, primarily due to increased product sales. Adjusted gross profit, which adjusts for the impact of acquired inventory step-up adjustments and intangible amortization, was $27.4 million in the second quarter of 2026, representing an adjusted gross margin of 73%, compared to adjusted gross profit of $14.1 million and adjusted gross margin of 75% in the prior year period. The decrease in adjusted gross margin in the second quarter of 2026 was due to higher INCRELEX sales outside the United States, which generates negative gross margin. The Company expects full year 2026 adjusted gross margin to exceed 70%, inclusive of the potential $4 million commercial milestone referred to above. Research and Development (R&D) Expenses: R&D expenses for the second quarter of 2026 were $1.0 million compared to $3.7 million in the prior year period. The decrease was primarily due to the DESMODA NDA submission fee in the prior year period. The Company expects full year R&D expenses of between $10 and $14 million, with a significant increase in the second half of 2026 due to increased development activity, including the initiation of the INCRELEX label harmonization study, a $3 million expense related to the licensing of ASN-001, and incremental spending related to ASN-001’s planned bioavailability study. General and Administrative (G&A) Expenses: G&A expenses for the second quarter of 2026 were $11.6 million compared to $9.7 million in the prior year period, an increase of 20%. Adjusted G&A expense, which removes share-based compensation, depreciation, transaction-related costs, and other one-time expenses, was $10.2 million in the quarter, compared with $7.6 million in the prior year period. The increase was attributable to increased headcount to support the growth of the business as well as increased cost of FDA program fees as the Company no longer qualifies for the orphan fee exemption. Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA): EBITDA for the second quarter of 2026 was $14.1 million compared to ($0.3) million in the prior year period. Adjusted EBITDA for the second quarter of 2026 was $16.2 million or 43% of revenue, compared to $3.1 million or 16% of revenue in the prior year period. Net Income/Loss: Net income for the second quarter of 2026 was $11.6 million or $0.35 per diluted share compared to a net loss of $2.6 million or $0.10 per basic and diluted share in the prior year period. On a non-GAAP basis, the Company reported net income of $14.3 million or $0.43 per diluted share for the second quarter of 2026 compared to net income of $1.5 million, or $0.03 per diluted share in the prior year period. For a reconciliation of GAAP net income/(loss) to Earnings Before Interest, Taxes, Depreciation and Amortization EBITDA (“EBITDA”), Adjusted EBITDA and adjusted Non-GAAP basic and fully diluted earnings per share to the most directly comparable GAAP financial measure, please see the tables below. Cash Position: As of June 30, 2026, the Company had cash and cash equivalents of $26.8 million. Conference Call and Webcast Information As previously announced, Eton Pharmaceuticals will host its Second quarter 2026 conference call as follows: In addition to taking live questions from participants on the conference call, management will be answering emailed questions from investors. Investors can email questions to: [email protected]. The live webcast can be accessed on the Investors section of Eton’s website at https://ir.etonpharma.com/. An archived webcast will be available on Eton’s website approximately two hours after the completion of the event and for 30 days thereafter. * Conference call participants should register to obtain their dial-in and passcode details. Please be sure to register using a valid email address. About Eton Pharmaceuticals Eton is an innovative pharmaceutical company focused on developing and commercializing treatments for rare diseases. The Company currently has eleven commercial rare disease products: KHINDIVI ®, INCRELEX®, ALKINDI SPRINKLE®, DESMODA™, GALZIN®, HEMANGEOL®, PKU GOLIKE®, IMPAVIDO® (September 2026 launch), Carglumic Acid, Betaine Anhydrous, and Nitisinone. The Company has five additional product candidates in late-stage development: ASN-001, AMGLIDIA®, ET-700, ET-800, and ZENEO® hydrocortisone autoinjector. For more information, please visit our website at www.etonpharma.com. Forward-Looking Statements Statements contained in this press release regarding matters that are not historical facts are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements associated with the expected ability of Eton to undertake certain activities and accomplish certain goals and objectives. These statements include but are not limited to statements regarding Eton’s business strategy, Eton’s plans to develop and commercialize its product candidates, the safety and efficacy of Eton’s product candidates, Eton’s plans and expected timing with respect to regulatory filings and approvals, and the size and growth potential of the markets for Eton’s product candidates. Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Words such as “believes,” “anticipates,” “plans,” “expects,” “intends,” “will,” “goal,” “potential” and similar expressions are intended to identify forward-looking statements. These forward-looking statements are based upon Eton’s current expectations and involve assumptions that may never materialize or may prove to be incorrect. Actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of various risks and uncertainties, which include, without limitation, risks associated with the process of discovering, developing and commercializing drugs that are safe and effective for use as human therapeutics, and in the endeavor of building a business around such drugs. These and other risks concerning Eton’s development programs and financial position are described in additional detail in Eton’s filings with the Securities and Exchange Commission. All forward-looking statements contained in this press release speak only as of the date on which they were made. Eton undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made. Non-GAAP Financial Measures In addition to the Company’s results of operations determined in accordance with U.S. generally accepted accounting principles (GAAP), which are presented and discussed above, management also utilizes Adjusted EBITDA, an unaudited financial measure that is not calculated in accordance with GAAP, to evaluate the Company’s financial results and performance and to plan and forecast future periods. Adjusted EBITDA is considered a “non-GAAP” financial measure within the meaning of Regulation G promulgated by the SEC. Management believes that this non-GAAP financial measure reflects an additional way of viewing aspects of the Company’s operations that, when viewed with GAAP results, provides a more complete understanding of the Company’s results of operations and the factors and trends affecting its business. Management believes Adjusted EBITDA provides meaningful supplemental information regarding the Company’s performance because (i) it allows for greater transparency with respect to key metrics used by management in its financial and operational decision-making; (ii) it excludes the impact of non-cash or, when specified, non-recurring items that are not directly attributable to the Company’s core operating performance and that may obscure trends in the Company’s core operating performance; and (iii) it is used by institutional investors and the analyst community to help analyze the Company’s results. However, Adjusted EBITDA and any other non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, or superior to, the corresponding measures calculated in accordance with GAAP. Further, non-GAAP financial measures used by the Company and the way they are calculated may differ from the non-GAAP financial measures or the calculations of the same non-GAAP financial measures used by other companies, including the Company’s competitors. Adjusted EBITDA The Company defines Adjusted EBITDA as net income/(loss), excluding the effects of stock-based compensation and expenses, interest, taxes, depreciation, amortization, and, if any and when specified, other non-recurring income or expense items. Management believes that the most directly comparable GAAP financial measure to Adjusted EBITDA is net income/(loss). Adjusted EBITDA has limitations and should not be considered as an alternative to gross profit or net income/(loss) as a measure of operating performance or to net cash provided by (used in) operating, investing, or financing activities as a measure of ability to meet cash needs. Investor Relations:Lisa M. Wilson, In-Site Communications, Inc.T: 212-452-2793E: [email protected]

Image source: The Motley Fool. Thursday, May 14, 2026 at 4:30 p.m. ET Chief Executive Officer — Sean Brynjelsen Chief Financial Officer — James Gruber Chief Commercial Officer — Ipek Erdogan-Trinkaus Executive Vice President of Accounting and Finance — Judy Matthews Need a quote from a Motley Fool analyst? Email [email protected] Sean Brynjelsen: Thank you, David. Good afternoon, everyone, and thank you for joining us today. The first quarter was another great quarter for Eton. We achieved record product sales delivering 73% year-over-year product revenue growth. We launched 2 new major products, DESMODA and HEMANGEOL. And we made great strides advancing our R&D programs with the achievement of several development milestones. We will discuss all of these items and more on the call today. On the quarterly results, it was another great quarter for Eton with $24 million in product sales, an increase of 73% year-over-year. Our growth continues to be driven by contributions across the product portfolio, including INCRELEX, ALKINDI, GALZIN and Carglumic Acid, highlighting the diversification and durability of our rare disease portfolio. This impressive revenue growth did not even include the benefit of the product launches of DESMODA and HEMANGEOL since they launched in mid-March and May, respectively. Based on the outperformance in the first quarter and the trends we are seeing midway through the second quarter, I'm pleased to report that we are raising our full year revenue guidance. We now expect revenue to exceed $120 million, up from our previous guidance of $110 million. Importantly, we delivered this notable first quarter revenue growth in a highly profitable manner. We grew product revenue by 73%, but G&A spending increased by only 14% year-over-year on a GAAP basis and 22% on a non-GAAP basis. The majority of the G&A increase was due to increased costs of FDA annual program fees now that we no longer qualify for the orphan PDUFA exemption rather than the true increases in our discretionary spend. Adjusted EBITDA for the quarter was $5.7 million or 24% of revenue. We continue to expect to achieve a greater than 30% adjusted EBITDA margin for the full year and believe we are on track to reach our goal of a 50% adjusted EBITDA margin by 2028. The results are a testament to the effectiveness and scalability of our unique rare disease model and infrastructure. Our nimble proven infrastructure has allowed us to launch 2 new products in 2026 so far without a significant increase in expenses and without impacting the execution of growth in our existing portfolio. We expect to see similar trends in the coming quarters as we continue to quickly grow revenue and bring to market new rare disease therapies. Turning to product specifics. I will start with our exciting new launch of HEMANGEOL, which took place just a matter of days ago. HEMANGEOL is the only FDA-approved treatment for infantile hemangiomas, which are noncancerous vascular tumors that appear shortly after birth and can sometimes lead to serious complications, including loss of vision, trouble breathing or permanent disfigurement. HEMANGEOL treatment is typically initiated as soon as an infant is diagnosed, which is usually before 6 months of age, and patients normally stay on treatment for approximately 6 months. HEMANGEOL is a remarkable product with impressive efficacy and clinically proven safety. The results are often life-changing for patients and their families. If you have not done so, I encourage you to search for before-and-after photos of severe infantile hemangiomas treated with HEMANGEOL to gain some perspective on how dramatic the results can be. With HEMANGEOL, we saw an opportunity to add meaningful value to an important treatment by, among other things, streamlining therapy access and distribution and improving patient support. HEMANGEOL is a time-sensitive treatment and we're dedicated to helping patients start therapy quickly and supporting families from the moment of prescription through treatment. HEMANGEOL expanded Eton into a third therapeutic area, pediatric dermatology, and importantly, brought an incredibly experienced team into the organization that was already promoting HEMANGEOL. This team has spent nearly a decade supporting physicians, families and patients within this community and have built deep, long-standing relationships focused on helping children access HEMANGEOL. One of the things we were most excited about in this acquisition was the opportunity to combine that experience and commitment to patients with Eton's rare disease commercialization model and patient support infrastructure. We believe Eton's focused rare disease approach, including Eton Cares, high-touch patient support, specialty pharma infrastructure and our no-patient-left-behind philosophy will further strengthen the work this team has already been doing for years on behalf of patients and families. We have already implemented several changes that we believe will improve the therapy experience for patients and providers and add value, including we have streamlined the distribution, shifting to a rare disease-focused model that reduces fragmentation and improves visibility and efficiency during the patient's journey. Under the prior structure, prescriptions could move across multiple pharmacies and intermediaries, which often created confusion for providers and families around where prescriptions were located, who was responsible for fulfillment and how to resolve access issues quickly. Secondly, we have launched our full Eton Cares patient support program, including streamlined $0 co-pay support for commercially insured patients and expanded patient assistance programs for uninsured and underinsured families. Previously, many families were paying approximately $55 per bottle, and in some cases, more than $100 per month depending on dosing and coverage, while access to co-pay support and financial assistance was often fragmented and difficult for offices and families to navigate. Third, we are already building upon the strong physician relationships the team developed over many years and are taking the next step in expanding engagement with thought leaders, professional societies and broader healthcare provider education initiatives to further increase awareness, education and appropriate patient identification within the treatment window. And lastly, we are actively engaging with the patient advocacy community around HEMANGEOL and are increasing our investment in long-term commitment to advocacy partnerships, caregiver education and community support initiatives. Our goal is not simply to support the therapy itself but to become a more active and visible partner to the broader patient community through meaningful engagement, education and resources. The responses from advocacy organizations and professional society partners have been incredibly positive, them welcoming Eton's commitment to expanding patient support, access resources and long-term investment in the community. Historically, we believe there has been significant usage of off-label adult propranolol formulations that are approved for cardiovascular indications. These adult formulations contain alcohol, sugar and other preservatives that are not suitable for infants. By contrast, HEMANGEOL, which is the only FDA-approved treatment for infantile hemangiomas, was formulated specifically for infants without containing alcohol or sugar. During our due diligence, we found that the primary reasons for the -- using off-label adult product were, one, the fact that the adult product had a lower co-pay than the $55 HEMANGEOL co-pay; and two, a lack of awareness among parents and prescribers about the alcohol and other excipients that are present in the adult formulation. We have addressed the co-pay issue with our $0 co-pay program, and we plan to address the awareness issue through our investments and efforts in new campaigns targeted at both prescribers and caregivers. There are still many variables and uncertainties involved with the launch. However, our preliminary view is that between our free drug patient assistance program, government patients and certain commercial payer contracts we inherited, we estimate that around 60% to 65% of the volume may be near 0 revenue, which should result in an estimated average net price per patient of around $8,000 to $10,000 for a full course of therapy. Of course, this is a preliminary estimate and a number of factors such as patient mix could cause the actual number to differ materially. We should have more precise insight by our next earnings call in August, and we'll update you accordingly. While it is a massive undertaking to get thousands of patients transferred from a broad distribution to a new single pharmacy in such a short period, our team has been preparing and working hard to complete it quickly and ensure that the process is as smooth as possible for families and prescribers. We're still early in HEMANGEOL's launch -- relaunch, I should say, but we have experienced cooperation from certain prior dispensing pharmacies, which we believe will help the situation in the transition. HEMANGEOL's revenue contribution to second quarter results is expected to be limited. Since it is launching mid-quarter, it may take several weeks or months to get patients fully transferred to the new pharmacy. We expect to start seeing a sizable revenue contribution beginning in the third quarter. And while it is still too early in the launch to say definitively, since there are a number of variables yet to play out, we believe that HEMANGEOL could be our largest product in 2027. Eton also launched DESMODA during the first quarter, shortly after its FDA approval. As the first and only FDA-approved desmopressin oral solution, DESMODA is a game-changer for patients because it eliminates the need to split or crush tablets, allowing for very precise dosing. Thought leaders in the community have described DESMODA as potentially transformative, given how individualized desmopressin dosing is from patient to patient and even with -- in the same patient over time throughout their treatment journey. Historically, patients and providers have often had reliance on suboptimal workarounds using tablets, nasal sprays, injections, none of which are designed to provide the combination of oral administration and precise flexible dose titration that many patients require. During our March earnings call, we were just a few weeks into the DESMODA launch, but I shared that I was encouraged by what I saw. I'm pleased to say the excitement level has continued in April and thus far in May. I am proud of our operations and commercial teams' exceptional launch plan and execution, and I believe that it was the best executed product launch in Eton's history and sets a new standard for future product launches. Since day 1 of the launch, peer-to-peer education efforts have complemented targeted field engagement across key accounts supporting early awareness and clinical dialogue. In parallel, Eton has had strong opportunities to engage with thought leaders at national and regional conferences. Earlier this month, our team attended 2 of the most important endocrinology conferences of the year: the Pediatric Endocrinology Nursing Society, and Pediatric Endocrine Society annual meetings. The timing was very favorable, coming in the midst of our DESMODA launch, and our team was able to take advantage of the opportunity to engage with hundreds of leading pediatric endocrinology prescribers of DESMODA. Importantly, the feedback was overwhelmingly positive. We believe the launch has also opened doors to important institutions that historically could be difficult to access, creating broader opportunities for meaningful dialogue not only around DESMODA, but across the rest of our pediatric endocrinology portfolio, including ALKINDI, INCRELEX and KHINDIVI. We believe the impact of these engagements will continue to build in the coming weeks and months. DESMODA fulfills a very specific need, and we've seen an enthusiastic reception from prescribers. DESMODA is being promoted by the same team of pediatric endocrinology rare disease specialists who promote ALKINDI, KHINDIVI and INCRELEX. So far, the product launch is meeting my high expectations and we continue to believe it could reach peak sales of $30 million to $50 million. Turning to the rest of our commercial products. The story remains consistent with that of the last few quarters. We continue to see strong, steady growth from across our diversified portfolio. INCRELEX, ALKINDI SPRINKLE and GALZIN all provided major growth contributions in the quarter. As we have discussed before, we believe we have captured relatively small share of the market opportunity for all 3 of these key growth products. So we continue to believe that they have long runways for growth ahead of them. On the R&D side of Eton, we have made strong progress advancing our pipeline and achieved a number of critical milestones in recent months. First, on INCRELEX, the label harmonization program, I am pleased to share that we now have received the FDA's clearance to proceed with our proposed clinical study. We intend to initiate the study in the second half of this year. The study will track approximately 30 patients over 5 years or until they reach full adult height with a primary endpoint of change in average annual height velocity at month 12 compared to pretreatment height velocity. As we've discussed extensively, we see a significant opportunity to expand the potential patient population by harmonizing the U.S. definition of severe primary IGF-1 deficiency to match that of Europe. If we are successful with harmonizing the label, we believe the INCRELEX market opportunity could increase fivefold in the United States. On ET-700, our extended-release zinc acetate, we announced that a pilot study has been initiated to test the efficacy of ET-700 relative to GALZIN and placebo in a double-blinded placebo-controlled clinical trial comprised of 36 healthy volunteers. PET scans with radioactive tracer copper will compare the effects on intestinal copper absorption of GALZIN taken 3 times daily, ET-700 taken twice daily plus a placebo taken daily as well. And a placebo also, I'm sorry, taken 3 times daily. The study treatment will last 4 weeks, and we expect to have the top line results in the second half of 2026. If early results are positive, they could lead to a pivotal clinical study in early 2027. We believe ET-700 could exceed $100 million of annual peak sales in the United States once it's approved. On our KHINDIVI label expansion program, where we are seeking to expand the FDA-approved range of the label beyond the current label of ages 5 and up, we are wrapping up final patient dosing in our bioequivalency study and expect to have results in the next couple of months. If successful, that will allow us to file our supplemental filing to the existing NDA in the third quarter and potentially receive approval in the second quarter of 2027. We have continued to see tepid uptake of KHINDIVI with its current restrictive label and believe the extended label will be the catalyst to see greater adoption. In addition, we progressed Amglidia, our oral liquid glyburide program, for the treatment of neonatal diabetes. Amglidia is approved and widely used in Europe, but has not been approved in the United States. Currently, there are no FDA-approved treatments for neonatal diabetes, so it represents a critical unmet need. Amglidia is a perfect strategic fit for us. It treats an extremely rare condition impacting only a few hundred patients in the United States, and it is prescribed by pediatric endocrinologists. 2 characteristics that we specialize in here at Eton. We recently filed an IND with the FDA, which should allow us to initiate the required bioavailability study by July of this year. Based on our current timelines, we expect to submit the product's NDA in the fourth quarter, which would give us the potential to deliver a high-value product launch in 2027. As you've heard this afternoon, it's been a great start to the year, and we're well positioned for an exceptional 2026. The momentum from our existing products remains strong. We've added 2 additional high-value product launches. We're meaningfully adding and advancing our pipeline to fuel long-term growth. And as always, we're continuing to pursue acquisition opportunities to expand our portfolio and add incremental revenue while maintaining our disciplined approach to operating expenses. Based on the strong performance in Q1, I believe we remain on track to reach the following forward long-term goals I outlined in March. Number one, build the largest rare disease portfolio in the United States. Two, reach a $200 million annual revenue run rate by end of 2027. Three, achieve a 50% adjusted EBITDA margin profile in 2028. And fourth, reach $500 million of annual revenue in 2030. Thank you for your ongoing support, and we look forward to keeping you apprised of the many exciting milestones ahead. Before I turn it over to James for the final time, I'd like to take a moment to personally thank him for his contributions and dedication to the organization over the last 4 years. He's done an exceptional job leading our finance department during a period of rapid growth as we grew from 2 to 10 commercial products in short order. Thank you, James, for all you've done on behalf of Eton. On June 1, Judy Matthews will take over as CFO. Judy joined us last month as Executive Vice President of Accounting and Finance and has been quickly getting caught up to speed on our business. Judy previously led finance departments of high-growth pharmaceutical companies, and we're excited to have her on board. With that, I'll turn it over to James to discuss the financial results. James? James Gruber: Thank you, Sean. First quarter revenue increased 40% to $24.3 million compared to $17.3 million in the first quarter of 2025, and we had $3.3 million of licensing revenue in the first quarter of 2025. Product sales and royalty revenue were $24.3 million during the quarter compared to $14.0 million in the prior year period, an increase of 73%, driven by strong growth across the portfolio, in particular INCRELEX, ALKINDI SPRINKLE, GALZIN and Carglumic Acid, as well as from the addition of sales from KHINDIVI, which was approved and launched in mid-2025. Gross profit for the quarter was $14.7 million compared with $9.9 million in the prior year period, an increase of 49%, primarily due to increased product sales. Adjusted gross profit, which adjusts for the impact of acquired inventory step-up adjustments and intangible amortization, was $16.2 million in the first quarter of 2026 or 67% of revenue compared to adjusted gross profit of $12.0 million and 69% of revenue in the prior year period. First quarter of 2026 included revenue from INCRELEX sales outside the U.S., which was dilutive to gross margin. We continue to expect to deliver full year 2026 adjusted gross margin of at least 70% and reach between 75% and 80% in the coming years. HEMANGEOL and DESMODA are both expected to have gross margin profiles well above our historic company average. R&D expenses for the quarter were $1.9 million, an increase of $0.7 million compared to $1.2 million in the prior year period, primarily due to higher clinical study expenses associated with the KHINDIVI label expansion and ET-700 development activities. We continue to expect full year 2026 R&D spending to be above last year's $7.8 million but less than $10 million. General and administrative expenses for the quarter were $10.4 million compared with $9.2 million in the prior year period. On an adjusted basis, which removes the impact of share-based compensation, transaction-related costs and other onetime expenses, G&A expense was $9.0 million compared to $7.3 million in the prior year period. The largest driver of the increase was higher FDA annual program fees since Eton no longer qualifies for the orphan PDUFA exemption as we now exceed the revenue threshold required to qualify. These fees were responsible for $0.9 million of the year-over-year G&A increase. The remaining increase was largely due to incremental headcount to support the growing portfolio. Adjusted EBITDA for the first quarter of 2026 was $5.7 million or 24% of revenue compared to $3.7 million or 21% of revenue in the first quarter of 2025, which had the benefit of licensing revenue. Our adjusted EBITDA will likely see fluctuations quarter-to-quarter depending on the timing of R&D expenses and ex U.S. INCRELEX orders, but we expect the full year adjusted EBITDA margin to be above 30%. Total company net income was $1.6 million for the quarter compared to a net loss of $1.6 million in the prior year period. Net income per basic and diluted share during the quarter was $0.06 and $0.05, respectively, compared to a net loss per basic and diluted share of $0.06 in the prior year period. On a non-GAAP basis, we reported net income of $4.5 million for the first quarter of 2026 compared to $2.4 million in the prior year period and diluted earnings per share of $0.14 for the first quarter of 2026 compared to $0.07 per share in the prior year period. In the first quarter, we generated $7.4 million in cash flow from operations, paid $14 million for HEMANGEOL and finished the quarter with $19.7 million of cash on hand. We recently amended our existing $30 million credit facility, which lowered our interest rate by approximately 200 basis points at no cost to Eton and no change to the end of 2027 maturity date. We remain in a very strong financial position and expect to see our cash balance grow significantly throughout the year, even with planned debt principal repayments. We expect to have significant excess cash at our disposal that can be used for accretive product acquisitions. In addition, given our significant EBITDA generation and our diversified portfolio, we believe we'd have significant debt capacity available to us should a larger acquisition opportunity present itself. Before we conclude, I'd like to express my sincere gratitude to Sean, the entire team here at Eton for the opportunity to work alongside such a talented, dedicated and passionate group of professionals. It's been a privilege to make a small contribution to Eton's remarkable growth and success, and most importantly, to the company's mission of improving the lives of the rare disease patients we serve. I'm extremely appreciative of the relationships and accomplishments that we've shared, and I remain confident that Eton will experience continued success and make a lasting impact on the healthcare community for many years to come. This concludes our remarks on first quarter results. And with that, we'll turn it back over to the operator for Q&A. Operator: [Operator Instructions] And our first question comes from the line of Madison El-Saadi of B. Riley Securities. Madison Wynne El-Saadi: Congrats on the quarter. And James, congrats on all the success here at Eton and wishing you the best of luck. So when we look at the product-level dollar contribution behind your $10 million guide, maybe just walk us through that. And we should probably assume this is 4Q loaded. And then secondly, regarding the HEMANGEOL price, maybe walk us through the $8,000 per patient per year. How does this compare to the base price that Pierre had it set at? I'm guessing this captures a typical 6-month course. And then if you could, any clarity into the proportion of the 8,000 patients that are retaining coverage at this new list price? And maybe since it's still pretty early, if you could just talk about kind of your expectations for that going forward? David Krempa: Sure, Madison. Starting with your question on the guidance -- increase in guidance. The HEMANGEOL launch was a big part of that as we got more comfortable launching it and a little more insights of what we thought we could do this year as well as outperformance from the rest of our portfolio. We had a strong Q1. We were happy with the results. We're seeing good trends already in Q2. We're happy with the DESMODA launch. So a combination of everything, but HEMANGEOL was definitely one of the important drivers of that. In terms of your question on the net price, yes, we do expect to net more than it was previously netting. We walked through -- roughly 60% to 65% of the patients will likely be non-revenue-generating or very low revenue-generating, but it should average out to around that $8,000 to $10,000 net price per patient. And that's our current estimate. Obviously, as you alluded to, it's still very early. We're only 2 weeks into it. I think it's too early to make any definitive statements to answer your question about the coverage. We historically had very good coverage on our products. So we expect that to continue, but too early in the launch to make any statements about that. Operator: Our next question comes from the line of Charles Wallace of H.C. Wainwright. Charles Wallace: This is Charles on for RK from H.C. Wainwright. So for my first question, something kind of struck me on the call, you said that HEMANGEOL could be the largest product by 2027. And I was just kind of curious, currently, on an annual run rate, what is currently the largest product currently sitting at for my first question? Sean Brynjelsen: This is Sean. We have indicated INCRELEX is our current largest product that continues to grow as well. With HEMANGEOL, we have obviously big expectations for it. We've transferred a large number of the patients over to -- and we're continuing that transfer process. We'll provide a little bit more color, I would imagine, on future calls. But we do want to see how this ramps before we can maybe give some directional guidance on that. Historically, we have not broken out sales by product, but we've spoken descriptively of it. And I think we'll certainly do that and revise our guidance as it transpires. Charles Wallace: And I guess for my second question from me, so I guess where are you currently with the patient number for INCRELEX, and are you confident with the 120 patients at the end of the year? Sean Brynjelsen: Yes. So again, we're not going to get into patient counts. Otherwise, I'll be giving patient count updates on every call. I can tell you that we're very much on track with what we've stated previously. We're very pleased with INCRELEX's performance. We have patients. It's been a great product. And it's the reason why it's our largest. We are also looking at initiating that label expansion study. So we do have significant plans for the product, and we'll keep everyone apprised as that enrollment occurs and as we get closer to being able to file that label update. Charles Wallace: And sorry, one more question, if I may. So I was just curious if -- as you're acquiring all these products, is it 1 specialty pharmacy that's handling all these drugs in the distribution? Sean Brynjelsen: That is correct. As we -- that's a good question, actually, because we've been -- we certainly -- that's where we're at today. And as long as they can continue to service our needs and meet our objectives for our portfolio, we're very happy with them. But we are -- we do have aspirations to have the largest rare disease portfolio in the industry. And if ever comes a point where we think we need to add another specialty pharmacy, we'll do that. But for right now, we're very pleased with Anovo and the work that they do. Operator: Our next question comes from the line of Chase Knickerbocker of Craig-Hallum. Chase Knickerbocker: Congrats on another nice quarter here. Sean, could you maybe just bridge the kind of change in guidance? Was -- the updated raised guidance, was it solely driven by kind of refining the HEMANGEOL model? Or what else drove it as far as how your assumptions changed from March to now? Sean Brynjelsen: Sure. So as David had indicated earlier, we have driven -- we've raised that guidance for a number of factors. Certainly, HEMANGEOL was a key part of that. Two, our base business, the commercial sales levels continue to be very strong. And as we're going into -- in the past few weeks, we see that momentum continue. Really across the board, we've been kind of hitting our numbers that we expect. And I guess the third thing is DESMODA, that launch is bringing in a significant number of patients. We're very happy with the launch. We just got out of an endocrinology meeting where there's a tremendous amount of excitement on that product, and I'm hoping to provide a little bit more clarity on what we think that -- ultimately that product can do. We've given off that guidance of $30 million to $50 million. We'll update that, I imagine, on our -- on future calls. And we'll see how -- but all of that kind of came together. And we said more than $120 million. So obviously, it's more than $120 million. We don't -- we'll leave it at that, and we'll see what happens. Chase Knickerbocker: Helpful. And maybe if I can draw some cross-currents between kind of your experiences with GALZIN and HEMANGEOL here. I mean you guys did a pretty good job of switching those patients pretty quickly into your distribution platform. I mean maybe talk about some of the learnings that you had from GALZIN and potential -- the potential for any sort of opportunity to do a little bit better than you guys are expecting as far as the kind of switching of those patients into your platform? Because again, we did outperform on GALZIN. So maybe just kind of talk about if that's a fair comparison and just some of your learnings. Sean Brynjelsen: Sure. So Chase, I'm going to turn that question over to our Chief Commercial Officer, Ipek. Ipek? Ipek Erdogan-Trinkaus: Thank you for the question. That is actually a great parallel, Few things that are very similar and a few things that are different. I think with GALZIN, it was all open network. It was multiple pharmacies. We actually -- we didn't even have the luxury at the time of collaborating with those pharmacies. So we kind of had to find all those patients ourselves. And I think we did a very good job, very effective job. And we knew at the time, without any numbers, anything that we inherited from the previous ownership that there was around 200 to 300 patients that were already on GALZIN. I think we already shared before, we are already over those numbers. We are about 300 patients already within the course of the year, which obviously was a very effective transition without having any collaboration. I think with HEMANGEOL the positives there obviously are -- there were 17 pharmacies, but this is also 8,000 patients. It's a big -- much bigger existing base of active patients. And basically pulling them from some local small pharmacies, some big pharmacies like Walgreens, so we've been working very hard for about 60 days between our sales team putting transition agreements with some of those pharmacies as well as Anovo, our specialty pharmacy, pulling those transfers through, which has been very good. Almost 60% of that 8,000 base, we were able to actually put some sort of a collaboration with the former pharmacies to agree to transfer the patients. So that's because we have been very good. But at the same time, it's a much bigger volume of patients to serve and make sure that there's continuity of care, nobody is behind without their drug. It's a much shorter course of therapy. That's another important distinction with GALZIN Obviously, it's a lifetime chronic therapy. So we still are finding those patients who were on GALZIN but also converting from patients who have never been on GALZIN on the competitive over-the-counter non-Rx therapies. So that's the goal right now of that conversion. But with HEMANGEOL, it's the -- time is of essence because we need to get those 8,000 patients into our system, serve them without any disruption, but also it's a 6-month therapy window. So we need to start acquiring new patients as well. Chase Knickerbocker: Helpful color. And then maybe just last from me, James, one last question for you here. Just as we think about the magnitude of the amount of OUS revenue for INCRELEX in the quarter, if you could share that. And then just what the associated COGS was of that? And certainly wish you all the best in your next endeavors, and it's been a pleasure working with you. James Gruber: Likewise. Thanks, Chase. So we have -- as far as the diluted margin profile on our ex U.S. INCRELEX revenue, it's about 2:1. So $2 of COGS to $1 of revenue. And it was low single-digit millions in Q1. We should have maybe a handful of similar orders. I think previously, we have estimated annual ex U.S. INCRELEX revenue of $2 million to $3 million, and that's still the estimate for 2026. Operator: Thank you. This concludes the question-and-answer session. Thank you for your participation in today's conference. This does conclude the program. You may now disconnect. 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