Q3 2026 Geron Earnings Conference Call - GERON CORP

Financial Performance:

• Third quarter 2026 net revenue reached $60.1 million, representing a 5% quarter-over-quarter increase and a 27% year-over-year growth.
• Total net product revenue trajectory positions the company to achieve the mid-to-high end of its 2026 guidance range ($220 million to $240 million).
• Gross-to-net deductions improved to 19.3% in Q3 2026 from 21.6% in the prior year period; expected to remain in the low-to-mid 20s for the remainder of 2026.
• Total operating expenses (excluding COGS) decreased to $48.3 million in Q3 2026 from $60.1 million in Q3 2025, driven by workforce reductions and operational discipline.
• Full-year 2026 total operating expense guidance lowered to $220 million–$230 million (previously $230 million–$240 million).
• Cash, cash equivalents, restricted cash, and marketable securities stood at $339 million as of September 30, 2026.
• Research and development expenses were $12.7 million in Q3 2026, down from $21.1 million, attributed to lower headcount and clinical/manufacturing costs, though post-marketing CMC commitments remain.
• Selling, general, and administrative (SG&A) expenses were $35.7 million, down from $39 million, primarily due to reduced personnel costs.

Guidance and Future Outlook:

• Company reaffirms 2026 net revenue guidance of $220 million to $240 million, expecting to finish at the mid-to-high end.
• Expects consistent quarter-over-quarter revenue growth for Rytello over the next several years, driven by adoption in the community setting and expansion into new patient segments (first and second-line).
• Future operating expenses are expected to remain steady through the remainder of 2026 but will increase in 2027 as the Europe strategy matures and post-marketing clinical commitments advance.
• Strategy shifts toward a "string of pearls" business development (BD) approach, targeting assets with potential peak sales of a few million rather than blockbuster-scale products, to complement the existing hematology franchise.

Business Segments and Product Lines:

• Rytello (Imetelstat): Achieved four consecutive quarters of demand growth; demand increased 10% in Q3 2026 compared to Q2. Prescribing accounts expanded to over 1,700, with 36% of starts being first or second-line patients in the last 12 months.
• European Commercial Launch: Initiated a gated commercial launch strategy, beginning with Germany with commercial availability expected by year-end 2026, followed by France in 2027. This hybrid model avoids full infrastructure build-out while preserving pricing control.
• Imetelstat in Myelofibrosis (MF): Discontinued Phase III IMPACT-MS trial for relapsed/refractory MF following Independent Data Monitoring Committee recommendation that the trial would not meet its primary overall survival endpoint. No new safety signals identified.
• Pipeline Development: Proceeding with real-world evidence generation and scientific engagements; plans to present new data at the 68th ASH Annual Meeting in December.
• Partnerships: Open to partnership opportunities in European markets to scale availability without upfront capital commitment.

Market and Competitive Landscape:

• Low-Risk MDS: Addresses a significant unmet need in low-risk MDS patients; Rytello holds a position in NCCN guidelines as a differentiated treatment with a unique first-in-class telomerase inhibitor mechanism.
• Competitive Environment: Notes differences between US and European markets, including less entrenched use of HMAs (hypomethylating agents) in Europe and specific regulatory labeling restrictions (RS-positive status in some regions) which Rytello's orphan designation and single-indication label are positioned to address.
• Market Access: Exclusion of orphan drugs like Rytello from the CMS GLOBE model is viewed as a positive factor for global accessibility.
• Competition in BD: Company targets smaller-scale hematology/oncology assets suitable for a community-dominant sales force rather than competing for large blockbuster assets.

Risks and Challenges:

• Clinical Trial Discontinuation: The decision to terminate the IMPACT-MS trial removes the potential upside of the MF indication, though data will be analyzed and shared.
• Forward-Looking Statements: Management cites risks related to future financial guidance, commercialization timelines in the EU, and clinical event outcomes.
• Operational Execution: Future growth depends on maintaining operational efficiency and successfully scaling the European launch without overextending cash reserves.
• Market Adoption: Continued reliance on community practice adoption to drive volume, though the company remains confident in the long-term runway.

Management Commentary and Tone:

• Tone is confident and disciplined, emphasizing four consecutive quarters of growth and a "winning strategy" for long-term value.
• Management highlights financial strength and a strong balance sheet ($339M cash) as a key enabler for BD opportunities and strategic investments.
• Haruth Samarjian (CEO) framed the MF trial discontinuation as the "right course of action" for patients and the company, while expressing excitement about the European launch and BD potential.
• Ahmed El-Nawawi (CCO) stressed the durability of the growth trajectory and the large addressable patient pool in the community setting.
• Michelle Robertson (CFO) underscored the importance of financial discipline in lowering OPEX guidance while maintaining investment capacity.

Analyst Questions and Answers:

• Tara Brancroft (TD Cowen): Asked about forward OPEX expectations given the reduction and the MF program wind-down.
  • Response: Michelle Robertson confirmed OPEX will remain steady for the remainder of 2026 but will rise in 2027 due to Europe strategy maturation and post-marketing clinical trial costs.
• Gil Plume (Needham): Inquired about the potential for accelerating Rytello's growth rate and specifics regarding Business Development targets.
  • Response: CEO Haruth Samarjian reiterated the commitment to consistent quarter-over-quarter growth rather than seeking specific inflection points. Regarding BD, the company seeks community-dominant hematology/oncology assets with peak sales in the low millions, leveraging the existing sales team's success.
• Steven Willey (Stiefel): Asked about inventory levels and European market management differences compared to the US.
  • Response: Inventory remains within the 2-to-4 weeks guidance. Management explained that European markets have different disease management patterns (less HMA use), older patient demographics, and significant advocacy from medical communities familiar with prior clinical trials (iMERGE).

Other Key Points:

• Rytello nominated for the "Prestigious" Pre-Dellium USA Award for Best Product for Orphan-Aware Diseases.
• Two new manuscripts published in peer-reviewed journals supporting imetelstat's role in low-risk MDS.
• Real-world evidence presented at SOHO and other international meetings highlights durable hemoglobin improvement and transfusion independence.
• The company views the MF trial data as a "rich data set" to inform future research despite the trial's termination.
• The company is well-positioned to explore BD opportunities given the reduced "MF overhang" and strong financials.