Coherus Oncology, Inc. (CHRS) Q1 2026 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The earnings call reveals a mixed outlook. While there's optimism with strategic partnerships and robust new patient starts, concerns arise from weather impacts on revenue and management's vague responses in the Q&A. The company's strong funding position and pipeline developments are positives, but uncertainties about treatment transitions and competitive pressures in the clinical space temper enthusiasm. Without clear financial guidance or market cap data, the stock reaction is likely to remain neutral, with limited short-term catalysts to drive significant price movement.
Key Financial Performance
LOQTORZI net sales $11.8 million in Q1 2026, down from $12.4 million in Q4 2025, but up 61% year-over-year compared to Q1 2025. The quarter-over-quarter decline was attributed to typical first-quarter seasonal trends and severe weather across large parts of the country.
R&D expenses $21.5 million in Q1 2026, down from $24.4 million in Q1 2025. The decrease was primarily due to savings from reduced headcount and infrastructure costs, reflecting tight spending discipline, partially offset by increased investments in the pipeline.
SG&A expenses $23.1 million in Q1 2026, down from $26 million in Q1 2025. The decrease reflects savings from Coherus' exit from the biosimilar business, which was completed more than a year ago.
Total cash, cash equivalents, and investments $167 million at the end of Q1 2026, down slightly from $172.1 million at year-end 2025. The slight decrease reflects operational expenses and investments.
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Operating Highlights
LOQTORZI: A next-generation differentiated PD-1 inhibitor used for nasopharyngeal cancer and as a combination therapy with pipeline molecules like casdozokitug and tagmokitug for other cancer indications. It is projected to generate $175 million annually at peak share and targets a $33 billion market opportunity.
Casdozokitug: Pipeline molecule being explored in liver cancer. Completed target accrual for the CATALYST-202 study in hepatocellular carcinoma, with initial data expected midyear 2026.
Tagmokitug: Pipeline molecule being explored across various cancers, including gastrointestinal, head and neck, and prostate cancer. It is part of a foundational Treg depletion platform and is being tested in combination with other therapies like T-cell engagers and radiotherapy.
Market Opportunity: Targeting a $33 billion market opportunity with LOQTORZI and its combinations.
Prostate Cancer Collaboration: First arrangement with J&J for tagmokitug in combination with pasritamig, a T-cell engager, for prostate cancer.
Revenue Growth: LOQTORZI net sales increased 61% year-over-year in Q1 2026. New starts reached an all-time high, with broader prescribing and deeper use in existing accounts.
Operational Efficiency: R&D expenses decreased to $21.5 million in Q1 2026 from $24.4 million in Q1 2025 due to reduced headcount and infrastructure costs. SG&A expenses also decreased to $23.1 million from $26 million in the same period.
Strategic Triad: Focus on LOQTORZI, proprietary combinations with pipeline assets, and Treg depletion platform with tagmokitug.
Exit from Biosimilar Business: Completed exit from the biosimilar business over a year ago, leading to cost savings and strategic focus on oncology.
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Risk or Challenges
CCR8+ Treg depletion challenges: The therapeutic promise of Treg depletion is facing challenges due to the need for the right molecule and target. Some market participants are pausing or stopping their programs, indicating difficulties in achieving selectivity, affinity, and pharmacology for CCR8 receptor targeting.
Clinical trial costs: The company's projected $175 million annual cash burn does not include clinical trial costs, which are viewed separately. This could pose financial strain if not managed effectively.
Market competition in CCR8 programs: Amgen halted enrollment in their CCR8 program due to poor results, and Gilead is advancing their program with mixed outcomes. This competitive landscape could impact Coherus' ability to succeed in this area.
Regulatory and biomarker challenges: The company is addressing FDA's Project Optimus and contribution of components in their trials, which could pose regulatory hurdles. Additionally, limited biomarker data from previous studies may impact the robustness of future analyses.
Seasonal and weather-related sales impact: Severe winter storms caused a more pronounced seasonal decline in sales for LOQTORZI, highlighting vulnerability to external factors affecting revenue.
Off-label PD-1 use and guideline misperceptions: Off-label use of PD-1 inhibitors in nasopharyngeal cancer (NPC) driven by guideline misperceptions could hinder LOQTORZI's market penetration.
Financial sustainability: The company relies on targeted investments and recent equity offerings to fund operations and pipeline development. This dependence on external funding could pose risks if revenue targets are not met.
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Guidance & Outlook
Revenue Projections: The company projects LOQTORZI revenue growth to build through the remainder of 2026, with expectations of $15 million per quarter in 2026, $30 million to $35 million per quarter in 2027, and a market share peak of about $44 million per quarter in 2028, translating to approximately $175 million annually.
Clinical Trial Progress and Data Readouts: The CATALYST-202 study for casdozokitug in hepatocellular carcinoma has completed target accrual, with initial data expected mid-2026. Additional data from other cohorts and studies, including tagmokitug combinations, are anticipated in the second half of 2026.
Market Opportunity: The company targets a $33 billion market opportunity through LOQTORZI and its proprietary combinations with pipeline assets.
Strategic Partnerships: Exploration of additional partnering opportunities, including T-cell engagers, ADCs, radiotherapy, and biospecifics, is ongoing. The first such arrangement with J&J in prostate cancer is progressing, with the first patient expected in fall 2026.
Product Development and Expansion: Plans to expand tagmokitug development with J&J's pasritamig and other combinations, such as ADCs or radiotherapy, are underway to address therapy resistance in cancer patients.
Operational and Commercial Focus: Efforts to drive LOQTORZI adoption include reducing chemo-only use, curbing off-label PD-1 use, and enhancing community and academic engagement through targeted investments and digital education.
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Shareholder Return Plan
The selected topic was not discussed during the call.
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Key Q&A
Q:Can you talk about the dynamics driving the average duration of treatment among existing patients for LOQTORZI? Is the growing duration driven by first-line patients? How do patients split between first and second line?
A:The duration of treatment depends on the type of patients. First-line locally advanced and metastatic patients have higher treatment durations compared to later-line metastatic monotherapy patients. Currently, 75%-80% of patients are from the metastatic setting, with a smaller percentage from the locally advanced recurrent setting. The company expects more locally advanced recurrent patients as the launch progresses. They have also purchased claims data to identify and target physicians managing these patients.
Q:What should investors expect to learn from the second-line head and neck and gastric cancer readouts for tagmo? Will next steps in clinical development be provided?
A:Initial data for second-line head and neck and upper GI adeno cancers is expected midyear, with at least 50% of patients reported. Key metrics include overall response rate, clinical benefit rate, and safety, though duration data will take longer to mature. Next steps will focus on durability and regulatory strategies, as well as identifying patient populations for later-stage development.
Q:For the head and neck cancer data for tagmo, what proportion of patients are expected to be PD-1 experienced? Will responses be broken out by HPV status?
A:All patients in the second-line head and neck study will be PD-1 or PD-L1 experienced. Responses will be stratified by HPV status.
Q:How does the company view the bar for response rates in light of investigational EGFRs and ADCs in the head and neck cancer setting?
A:The current standard of care, cetuximab, has a 13%-15% ORR. Investigational EGFRs show positive data in first and second-line settings, primarily benefiting HPV-negative patients. The company sees opportunities for novel agents, particularly in combination therapies, to improve durability and broaden responses.
Q:Can you provide more details about the weather impact on LOQTORZI's top line and reconcile it with record new patient starts?
A:Weather impacted existing patients, causing missed cycles due to winter storms. This led to a 5% decline from Q4 to Q1, consistent with historical seasonality patterns. New patient starts were robust, driving future growth. Missed cycles for existing patients are considered lost revenue.
Q:What is the correlation between IL-27 expression and tumor reduction in preclinical models for the 202 study?
A:Preclinical models show tissue-specific IL-27 expression, particularly in the lung and liver. Initial readouts will focus on trends in circulating tumor DNA and IL-27 levels to assess the probability of positive study outcomes as data matures.
Q:Do you expect differences in efficacy or safety between atezo/bev and tori/bev as backbones in the casdozo program?
A:Toripalimab and bevacizumab (tori/bev) showed similar or slightly higher overall survival compared to atezo/bev in non-head-to-head studies. Toripalimab has a lower ADA rate, and the safety profile has been favorable, with no additional toxicities observed.
Q:How does the company view the competitive landscape for CCR8 antibodies, particularly with LaNova's Phase III trial?
A:The company sees LaNova's Phase III trial as validating the mechanism and is encouraged by other advancing programs (e.g., Gilead, AbbVie, BMS). Differences in pharmacology are believed to account for the lack of activity in some programs, such as Amgen's.
Q:Given the seasonality impact, can LOQTORZI still achieve $30-$35 million in quarterly sales by 2027?
A:The company remains confident in achieving $30-$35 million in quarterly sales by 2027, supported by data purchases and knowledge of the therapeutic area.
Q:Was the impact of storms on LOQTORZI's revenue due to new patient starts or ongoing therapy? Is this deferred revenue?
A:The impact was primarily on existing patients, with missed cycles due to storms. This is not deferred revenue, as missed cycles are considered lost. New patient starts were unaffected and remain robust.
Q:Is the company financially prepared to continue its clinical programs for tagmo and other opportunities?
A:The company is funded through 2026 and 2027 for its clinical programs. Additional trials, if deemed worthwhile, would be presented to investors. Current programs are fully funded.
Q:Review of Unclear Management Responses
A:Management avoided providing specific numerical data or clear timelines for certain metrics, such as the exact percentage of patients expected to transition to first-line LOQTORZI treatment or detailed comparisons between atezo/bev and tori/bev efficacy. Additionally, responses about the correlation between IL-27 expression and tumor reduction in preclinical models lacked clarity, as preclinical data was described as tissue-specific without quantifiable insights.
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Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
ADCs radiotherapy
AI platform
Amgen
CATALYST study
CCR program
Cohort
Denny
Gilead
JJ
PK potency
analysis tumor
anticancer therapy
basket
biomarkers
casdozokitug study
cell engager
combination patient
context
decrease
drug development
engager combination
field
label use
marker
midyear frame
molecule casdozokitug
nuance
others program
pasritamig cell
pharmacology
prostate
protocol
tagmo combination
tagmo torus
torus combination
tumor DNA
CHRS Transcript
Coherus Oncology, Inc. (CHRS) Q1 2026 Earnings Call Transcript
Unknown5-12
The earnings call reveals a mixed outlook. While there's optimism with strategic partnerships and robust new patient starts, concerns arise from weather impacts on revenue and management's vague responses in the Q&A. The company's strong funding position and pipeline developments are positives, but uncertainties about treatment transitions and competitive pressures in the clinical space temper enthusiasm. Without clear financial guidance or market cap data, the stock reaction is likely to remain neutral, with limited short-term catalysts to drive significant price movement.
Coherus Oncology, Inc. (CHRS) Q4 2025 Earnings Call Transcript
Positive3-9
The earnings call reveals strong financial performance with revenue growth and significant debt reduction, alongside strategic investments in R&D and sales force expansion. The Q&A section highlights management's focus on growth and innovation, with positive sentiment from analysts. Despite some uncertainties in management responses, the overall outlook is optimistic with potential for market expansion and partnerships. This suggests a positive stock price movement over the next two weeks.
Coherus Oncology, Inc. (CHRS) Presents at 44th Annual J.P. Morgan Healthcare Conference Transcript
Neutral1-13
Coherus Oncology, Inc. (CHRS) Presents at UBS Global Healthcare Conference 2025 Transcript
Neutral11-10
CHRS Report
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