Knight Therapeutics Reports Record Revenues Amid Challenges

Knight Therapeutics ((TSE:GUD)) has held its Q3 earnings call. Read on for the main highlights of the call.

Knight Therapeutics Shines with Record Revenues Despite Regulatory Hurdles

Knight Therapeutics recently held an earnings call that showcased a robust financial performance, marked by record revenues and EBITDA. The sentiment during the call was overwhelmingly positive, highlighting significant growth driven by key products and an optimistic financial outlook for 2025. Despite facing regulatory challenges in Brazil and Canada and a financial asset loss, the company remains on a solid growth trajectory.

Record High Adjusted Revenues and EBITDA

Knight Therapeutics reported record high adjusted revenues of $319 million and an adjusted EBITDA of approximately $49 million for the nine months ending September 30, 2025. This represents an impressive 18% increase in revenues compared to the same period last year, underscoring the company’s strong financial performance.

Revenue Growth from Key Products

The company’s revenue growth was significantly bolstered by the Paladin and Sumitomo transactions, which contributed $27 million in incremental revenues. Additionally, key promoted products delivered organic growth of 12% on a constant currency basis, further enhancing the company’s financial standing.

Expansion of Oncology Portfolio

Knight Therapeutics expanded its oncology portfolio by in-licensing the LatAm rights to two innovative drugs, retifanlimab and axatilimab, through a partnership with Incyte. The company also launched several products, including JORNAY PM in Canada, MINJUVI in Argentina, and PEMAZYRE in Brazil and Mexico, strengthening its presence in the oncology market.

Increased Financial Outlook for 2025

The company has raised its financial outlook for fiscal 2025, projecting revenues between $430 million and $440 million, with an adjusted EBITDA margin of 13.5% to 14.5%. This optimistic forecast reflects the company’s confidence in its growth strategy and market position.

Increased Credit Facility

To support its growth initiatives, Knight Therapeutics doubled its revolving credit facility from USD 50 million to USD 100 million, with an option to increase it by another USD 100 million. This move provides the company with enhanced financial flexibility to pursue strategic opportunities.

Rejection of Marketing Authorization in Brazil

Despite the positive financial performance, Knight faced a setback with the rejection of its marketing authorization application for TAVALISSE by Anvisa, the Brazilian Health Agency. The company has submitted an appeal, which could take up to 14 months to resolve.

Notice of Noncompliance from Health Canada

Knight also received a notice of noncompliance from Health Canada regarding the drug submission for Qelbree. The company is required to submit additional information by 2026, which poses a challenge to its regulatory strategy.

Financial Asset Loss

The company recorded a net loss of $4.6 million due to mark-to-market revaluations of strategic fund investments. While this represents a financial setback, it does not overshadow the overall positive trends in the company’s performance.

Forward-Looking Guidance

Knight Therapeutics provided an optimistic forward-looking guidance, reporting record adjusted revenues of $122.6 million for the third quarter of 2025, a 34% increase from the previous year. The company achieved an adjusted EBITDA of $21 million, marking a 56% rise, driven by key transactions and a 15% increase in oncology product revenues. Despite regulatory challenges, the company has raised its 2025 revenue guidance to between $430 million and $440 million, with an adjusted EBITDA margin of 13.5% to 14.5%.

In conclusion, Knight Therapeutics has demonstrated strong financial performance with record revenues and a positive outlook for 2025. While regulatory challenges in Brazil and Canada present hurdles, the company’s strategic initiatives and financial flexibility position it well for continued growth. Investors and stakeholders can remain optimistic about Knight’s future prospects.