Skip to content
    HALO
    Earnings call· Mar 2026(Q1 FY26)

    HALOZYME THERAPEUTICS Q1 FY26 earnings call HALO

    May 11, 2026 Source

    Executive summary

    Halozyme Q1 FY26 — Strong Royalty Growth and Reaffirmed Guidance, New Buyback Program

    Halozyme delivered a strong Q1 FY26, driven by robust growth in ENHANZE royalty revenues and broad-based strength across its portfolio. The company reaffirmed its full-year and 2026-2028 financial guidance, emphasizing durable value creation through existing products and a growing pipeline. Strategic capital allocation includes a new share repurchase program and continued investment in Hypercon and Surf Bio technologies.

    Highlights

    5

    • Royalty revenues increased 43% year-over-year to $240.7 million.

    • Total revenue increased 42% year-over-year to $376.7 million.

    • Adjusted EBITDA increased 42% year-over-year to $229.5 million.

    • Non-GAAP diluted EPS increased over 40% year-over-year to $1.60.

    • New $1 billion share buyback authorization announced, with $400 million expected in 2026.

    Concerns

    2

    • Unlikely to identify a drug delivery M&A opportunity meeting criteria in 2026.

    • Hypercon first 2 Phase I clinical starts pushed to H1 2027 from prior expectations.

    Guidance & targets

    14
    CategoryTargetConfidence
    Full-year 2026 Total Revenue
    $1.71 billion to $1.81 billion
    high materiality
    High
    Full-year 2026 Royalty Revenue
    $1.13 billion to $1.17 billion
    high materiality
    High
    Full-year 2026 Adjusted EBITDA
    $1.125 billion to $1.205 billion
    high materiality
    High
    Full-year 2026 Non-GAAP Diluted EPS
    $7.75 to $8.25
    high materiality
    High
    Adjusted EBITDA Margin
    greater than 65%, growing to approximately 70%
    high materiality
    High
    Share Buyback Authorization
    $1 billion
    high materiality
    High
    Share Buyback Execution
    at least $400 million
    high materiality
    High
    Annual Share Buyback Yield
    3%
    medium materiality
    Medium
    Net Leverage
    approximately 1.2x
    high materiality
    High
    Hypercon Royalty Revenue
    approximately $1 billion
    high materiality
    Medium
    Hypercon First Phase I Clinical Starts
    First half of 2027
    medium materiality
    High
    Hypercon First Product Launches
    2030, 2031
    medium materiality
    Medium
    New Collaboration and Licensing Agreements
    3 new deals
    medium materiality
    High
    ENHANZE Pipeline Products Launch
    up to 13 additional ENHANZE partner products
    high materiality
    Medium

    Segment performance

    5
    SegmentRevenueYoYQoQMargin
    DARZALEX (ENHANZE)
    Gold standard in multiple myeloma, #1 product for Johnson & Johnson. Royalty rate step-up achieved faster in Q1 FY26 than prior years. Additional growth expected from new indications.
    Global sales: ~$4 billionOperational growth: ~18%
    		$129 million26%——
    VYVGART Hytrulo (ENHANZE)
    Growing and meaningful contributor to royalty revenue. Prefilled syringe introduction accelerated subcutaneous uptake. Steady progress in CIDP. Recent FDA approval for all serotypes of adult patients with generalized myasthenia gravis. Positive Phase III data in ocular myasthenia gravis.
    Global sales: ~$1.3 billionGrowth: ~63%
    		$46.3 million119%——
    PHESGO (ENHANZE)
    Roche expects to reach at least 60% conversion and maintain a strong, durable revenue tail. Small difference between reported sales and Halozyme royalties due to currency.
    Sales: CHF 686 million (~$877 million)Growth: 27%
    		$30.2 million25%——
    OCREVUS ZUNOVO (ENHANZE)
    Strong and accelerating uptake, expanding access across multiple sclerosis care settings. Ability to expand addressable market by reducing infusion burden.
    Patients globally receiving subcutaneous OCREVUS: ~24,000Increase vs prior quarter: ~7,000 patientsU.S. OCREVUS ZUNOVO starts from community practices: ~60%New subcutaneous OCREVUS patients naive to brand: ~50%Roche peak brand sales expectation: CHF 9 billion by 2029Brand expansion from subcutaneous formulation: ~CHF 2 billion
    		————
    RYBREVANT FASPRO (ENHANZE)
    Sales driven by launch uptake and share gains. Increasing contribution from the subcutaneous formulation supporting adoption and reinforcing positioning in EGFR-mutated non-small cell lung cancer. Identified as an important longer-term growth driver by J&J.
    Sales (RYBREVANT + LAZCLUZE): $257 millionGrowth: 80%J&J brand sales projection: $5 billion
    		————

    Operational metrics

    20
    Total Revenue
    $376.7 millionup 42% YoY
    Q1 FY26

    Driven by broad-based strength, including royalty revenue and product sales to partners.

    Royalty Revenue
    $240.7 millionup 43% YoY
    Q1 FY26

    Reflecting continued commercial success of key ENHANZE partnered products and ramp from recently launched SC therapies.

    Research and Development Expenses
    $25.6 millionvs $14.8 million in Q1 FY25
    Q1 FY26

    Increase due to integration of Hypercon and Surf Bio acquisitions.

    Selling, General and Administrative Expenses
    $57.9 millionvs $42.4 million in Q1 FY25
    Q1 FY26

    Operating expenses for the quarter.

    Adjusted EBITDA
    $229.5 millionup 42% YoY
    Q1 FY26

    Driven by continued strong royalty growth, even with investments in Hypercon and Surf Bio.

    Non-GAAP Diluted EPS
    $1.60vs $1.11 in Q1 FY25
    Q1 FY26

    Represents a greater than 40% increase year-over-year.

    GAAP Diluted EPS
    $1.22vs $0.93 in Q1 FY25
    Q1 FY26

    Reported GAAP earnings per share.

    Net Leverage
    approximately 2.5x
    End of Q1 FY26

    Reflecting acquisitions of Hypercon and Surf Bio.

    ENHANZE Royalty Revenue Still to Come
    66%
    2026-2032

    The majority of royalty revenue from current 10 ENHANZE products is still to be realized.

    ENHANZE Partners Initiating Phase I Studies
    2
    Q1 FY26

    These additions contribute to the 13 products already in development.

    ENHANZE Targets in Development
    7
    Q1 FY26

    Number of products already in development prior to Q1 FY26 additions.

    Pfizer New ENHANZE Target Nomination
    —
    Q1 FY26

    Pfizer nominated a new, undisclosed nonexclusive target to be studied with ENHANZE, adding to the 13-product pipeline.

    Hypercon CLAs
    5
    To date

    Total number of collaboration and licensing agreements signed for Hypercon.

    Hypercon Potential Targets
    17
    To date

    Total number of potential targets covered by Hypercon CLAs.

    Hypercon Available Targets in Signed CLAs
    up to another 15
    Future

    Remaining opportunities for partners to nominate additional targets under existing Hypercon agreements.

    ENHANZE Available Targets in Signed CLAs
    tens
    Future

    Remaining opportunities for partners to nominate additional targets under existing ENHANZE agreements.

    ENHANZE Patients Treated
    more than 1.3 million
    Cumulative

    Cumulative number of patients treated with ENHANZE-enabled products, highlighting its established safety profile.

    ENHANZE Co-formulation Patent Duration
    20 years
    From filing

    Co-formulation patents extend royalty terms beyond the base composition of matter patents, which expire in 2029 in the U.S. and Europe.

    Psoriasis Market Size
    $20 billion to $25 billion
    Global

    Market size for ORKA-001, a Hypercon partnered product, highlighting its potential.

    IV and Subcutaneous Market Opportunity
    $30 billion
    2028

    Estimated total market opportunity for recently launched ENHANZE products, based on analyst estimates.

    Industry KPIs

    7
    MetricValueDetails
    Launch access metrics60%%
    Pipeline read out calendar13 products
    Regulatory approvals filingsFDA approval
    Peak long term sales guidanceCHF 9 billionCHF
    Clinical trial efficacy safety dataPositive Phase III data
    Collaboration milestone royalty revenuemid-single-digit%
    Cumulative patients uptake since launch24,000patients

    Product announcements

    2
    ProductTypeDetails
    DARZALEX FASPROexpansion
    VYVGART and VYVGART Hytruloexpansion

    Deals & partnerships

    3
    GSKNew ENHANZE collaboration agreement for multiple promising oncology targets, including antibody drug conjugates.

    Expands ENHANZE footprint with another global pharmaceutical leader and marks the first ENHANZE collaboration for antibody drug conjugates, extending technology into a fast-growing and large TAM area of oncology.

    Vertex PharmaceuticalsNew Hypercon collaboration enabling use of hyperconcentration technology with up to 3 Vertex targets.

    Demonstrates growing demand for next-generation delivery solutions beyond ENHANZE. Vertex is a recognized leader in transformative medicines.

    OrukaSecond Hypercon collaboration and licensing agreement for ORKA-001 (psoriasis) and up to 1 additional target.

    ORKA-001 recently presented Phase II data showing best-in-class efficacy for moderate to severe psoriasis. Further validates Hypercon as a differentiated, royalty-bearing technology.

    Risks & headwinds

    2
    Drug delivery M&A opportunities not meeting criteriaFY26

    Unlikely to identify an opportunity to transact on in 2026.

    Mitigation: Focus on organic investments and returning value to shareholders through buybacks.

    Delay in Hypercon Phase I clinical startsH1 2027

    First 2 Phase I clinical starts now projected for H1 2027 (previously implied earlier).

    Mitigation: Investing in manufacturing capacity to provide end-to-end services and finalize clinical supply manufacturing.

    What to watch in Q2 FY26

    5

    Hypercon Phase I Clinical Starts

    H1 2027
    Current0
    Target2 starts in H1 2027

    Why it matters

    Verifies progress of Hypercon technology into clinical development, a key driver for 2029+ revenue.

    And we now project that the first 2 Phase I clinical starts will occur in the first half of 2027.

    Q&A highlights

    5

    What are the biggest ENHANZE products expected post-2029 and when will they peak? How many Hypercon discussions were pre-acquisition versus new?

    The majority of royalty revenue from current 10 ENHANZE products (66%) is still to come between 2026-2032, with products like OCREVUS, RYBREVANT, VYVGART, and DARZALEX contributing significantly. For Hypercon, one deal was ongoing pre-acquisition, one was new, and there's broader interest and early feasibility testing underway, driven by the secular trend towards subcutaneous and at-home delivery.

    “I think what we shared was, and I think it was probably a surprise to many of our investors, that we still have 66% of the revenue from our current 10 launched products coming between 2026 and 2032.”

    asked by Jason Butler · answered by Helen Torley

    2 min read6 chapters

    Detailed Narrative

    01

    Strategy for Durable Value Creation

    Halozyme's strategy focuses on delivering durable value across two key timeframes: 2026-2028 and 2029+. The 2026-2028 period is driven by the continued strong performance of its first 10 ENHANZE launch products, including DARZALEX subcutaneous, VYVGART Hytrulo, and PHESGO. The company projects adjusted EBITDA margins to grow from over 65% to approximately 70% during this period, supported by efficient revenue conversion to free cash flow.

    02

    Capital Allocation Priorities

    The company plans to deploy capital in four key areas: maximizing organic investments in ENHANZE, Hypercon, and Surf Bio; executing a new $1 billion share buyback authorization, with at least $400 million expected in 2026; further deleveraging by retiring 2027 and 2028 notes at maturity; and evaluating drug delivery M&A opportunities, though none are expected to meet criteria in 2026. This disciplined approach aims to create new value and return value to shareholders.

    03

    2029+ Growth Drivers and Pipeline Expansion

    Growth beyond 2029 will be fueled by four sources: continued performance of the current 10 ENHANZE products, up to 13 new ENHANZE launches from the current pipeline, two Hypercon product launches in 2030-2031, and a 'next wave' of launches from additional target nominations in existing agreements and new collaborations for ENHANZE, Hypercon, and Surf Bio. The company estimates 66% of projected royalties from current products are still to come between 2026 and 2032.

    04

    Hypercon and Surf Bio Development

    Halozyme is investing in manufacturing capacity to offer end-to-end services for Hypercon partners, from drug substance to commercial fill/finish. The first two Hypercon Phase I clinical starts are now projected for H1 2027, with launches expected in 2030-2031. Surf Bio is 18-24 months behind Hypercon, with ongoing nonclinical qualification and GMP manufacturing preparation. The company sees significant interest in hyperconcentration technologies due to the demand for low-volume, at-home administration.

    05

    New Collaboration and Licensing Agreements

    Halozyme has already met its 2026 goal of signing three new collaboration and licensing agreements, with line of sight to additional deals. These include an ENHANZE collaboration with GSK for oncology targets (including antibody-drug conjugates), and two Hypercon collaborations with Vertex Pharmaceuticals and Oruka. These deals include upfront milestones, potential for additional milestones, and mid-single-digit royalties, validating the demand for next-generation drug delivery solutions.

    06

    Product Portfolio Performance and Expansion

    Key products like DARZALEX, VYVGART Hytrulo, and PHESGO continue to drive strong royalty revenue growth. DARZALEX global sales were approximately $4 billion (up 18% operational growth), generating $129 million in royalties (up 26%). VYVGART global sales were approximately $1.3 billion (up 63%), contributing $46.3 million in royalties (up 119%). PHESGO sales were CHF 686 million (approx. $877 million), generating $30.2 million in royalties (up 25%). Recent FDA approvals for DARZALEX FASPRO and VYVGART Hytrulo are expected to further fuel growth by expanding indications and patient populations.

    AI-generated summary of the company’s earnings call. Not investment advice.