Rigel Pharmaceuticals Inc. (New) 2026 Q2 Earnings Call

Welcome to our second quarter 2026 financial results and business update conference call. The financial press release for the second quarter 2026 was issued earlier today and can be viewed along with the slides for this presentation in the News and Events section of our investor relations site on rigel.com. As a reminder, during today's call, we may make forward-looking statements regarding our financial outlook and our plans and timing for commercial regulatory product development and other business activities. These statements are subject to risks and uncertainties that may cause actual results to differ from those forecasted. Description of those risks can be found in our most recent annual report on Form 10-K for the year ended December 31, 2025, on file with the SEC, and subsequent filings with the SEC, including our Q2 quarterly report on Form 10-Q with the SEC.

Any forward-looking statements are made only as of today's date, and we undertake no obligation to update these forward-looking statements to reflect subsequent events or circumstances, except as required by law. At this time, I would like to turn the call over to our President and Chief Executive Officer, Raul Rodriguez.

Raul? Thank you, Ray, and thank you all for joining us today.

Also with me today are Dave Santos, our Chief Commercial Officer, and Dean Schorno, our Chief Financial Officer. I would also like to welcome Dr. Alison Hannah, our newly appointed Chief Medical Officer, who is with us today and will discuss our development pipeline. To begin, I will provide an overview of Rigel's business, our accomplishments for the second quarter, and the strategic initiatives that positions us for continued growth in the coming years. Moving to slide four. The second quarter was an excellent one and marked an important step in Rigel's transformation into a diversified commercial oncology and hematology company. During the quarter, we continued to grow our current products. We completed the in-license of VEPPANU or vepdegestrant, adding a significant near-term growth driver.

We delivered another quarter of strong profits, and we continued advancing R289 in lower-risk MDS in our dose expansion trial with a readout at year-end. We believe these actions positions Rigel for sustainable near-term and long-term growth. On the slide, you see the strategic framework that has guided Rigel's transformation and will continue to drive our growth. Our strategy is centered on four core strategic objectives: grow our commercial business, expand our product portfolio and pipeline through in-licensing or acquisition, advance our development pipeline in the clinic, and maintain financial discipline. Together, these four pillars support a durable long-term growth strategy. Our May announcement of the exclusive global license of VEPPANU demonstrates our execution of this strategy. It expands our portfolio with an important new commercial opportunity and furthers our long-term growth trajectory. Moving to slide five. VEPPANU significantly expands Rigel's commercial oncology platform into breast cancer and provides the opportunity to leverage our commercial capabilities across this very substantially larger market.

VEPPANU is the first and only FDA-approved proteolysis targeting chimera, or PROTAC, for the patients with second-line or later ER-positive, HER2-negative, advanced or metastatic breast cancer with an ESR1 mutation. There is a critical unmet need in this patient population, and we believe VEPPANU is an important new treatment option. With the novel mechanism and differentiated data, we believe VEPPANU has potential to become a market-leading treatment. When the transaction was closed in June, our team across the organization began actively preparing for the commercial launch, and we are on track for VEPPANU to be available in mid-August. Dave and Alison will provide more information on our launch preparations and the clinical data supporting the FDA approval. Moving to slide six. Since 2020, we have transformed Rigel from a single-product company with a limited development pipeline and significant cash burn into the profitable multi-product company with a promising pipeline that we are today.

In 2026, we expect to grow a compound annual growth rate of approximately 35% since 2022 using the midpoint of our 2026 net product sales guidance, which excludes any contribution from VEPPANU. We view this performance as a foundation of our next phase of growth. Our in-license of VEPPANU marks the next major step in Rigel's evolution. We believe it has potential to become Rigel's largest commercial product and meaningfully drive growth through the end of the decade and beyond. Looking towards the 2030s, we plan to build on the momentum of our commercial portfolio.

We will also continue to evaluate late-stage in-licensing or acquisition opportunities that address areas of significant need, offer substantial growth potential, and continue to further expand our portfolio. Subject to positive clinical data and regulatory approval, R289 could become a new treatment option for patients with lower risk MDS and potentially other indications. Several of the possible R289 indications represent potentially billion-dollar market opportunities. If successful, this could significantly expand our commercial portfolio in the 2030s and beyond. Together, these opportunities can drive sustained growth and long-term shareholder creation with the potential to transform Rigel once again. With that, I will turn the call over to Dave to discuss our commercial business and VEPPANU and our progress towards commercial availability.

Dave? Thank you, Raul. On slide eight, you'll see our three commercial products, TAVALISSE, GAVRETO, and REZLIDHIA.

Moving to slide nine, which shows our product revenue for the second quarter of 2026. We generated $67 million in U.S. net product sales, an increase of $8.1 million over the second quarter of 2025, representing a 14% increase year-over-year. For TAVALISSE, we reported another strong quarter in which we generated a record, $47.4 million in net product sales, an increase of 18% compared to the second quarter of 2025, which was aided by favorable gross to net and inventory dynamics. TAVALISSE was launched in our portfolio. And finally, for REZLIDHIA, we reported $8.9 million in net product sales, an increase of 27% compared. We believe emerging frontline venetoclax data may further reinforce the relevance of REZLIDHIA in the post-venetoclax setting and improve adoption in the community.

We believe that these efforts and data can be elements to continued REZLIDHIA growth into the future. Overall, we're pleased with our second quarter results. While VEPPANU will become our lead focus upon commercial availability, we remain committed to supporting TAVALISSE, REZLIDHIA, and GAVRETO. Moving to slide 10, we generated $11.7 million in revenues from collaborations in the second quarter, driven by the availability of TAVALISSE in global markets and a regulatory milestone payment for elacestrant. Our partners continue to pursue regulatory approvals for both TAVALISSE and REZLIDHIA in new markets. In May, our partner, Knight, commercially launched TAVALISSE in Mexico, and they achieved regulatory approval of TAVALISSE in Brazil, with plans to commercially launch there in the second half of 2026. Also in May, Kissei announced they submitted a new drug application for elacestrant for marketing approval in Japan.

We are delighted that access to our products is expanding outside the U.S. With that, I'll now turn attention to the newest addition to our commercial portfolio, VEPPANU. One line of endocrine therapy. Moving to slide 13, we believe VEPPANU has the potential to transform our commercial portfolio. Importantly, VEPPANU is the first and only approved PROTAC, a new class of targeted agents. It has a novel mechanism of action and potential to be an important new treatment option for patients. We believe our proven commercial and medical expertise and organization enable us to successfully commercialize VEPPANU. We integrated both REZLIDHIA and GAVRETO into our portfolio over the last four years, and that experience served us well as we needed to quickly integrate VEPPANU to ensure readiness in such a short amount of time.

Lastly, importantly, we believe moving forward that VEPPANU has the potential to become Rigel's largest revenue producer. On slide 14, I'll take you through the unique biology of proteolysis targeting chimeras, or PROTACs, which are bifunctional small molecules that destroy specific disease-causing proteins rather than just inhibiting them. The VEPPANU PROTAC design consists of three parts. A targeting ligand that binds to the estrogen receptor, or ER, a recruiting ligand that binds to the E3 ligase complex, and a linker connecting them. This unique design represents a major innovation in ER degradation. First, VEPPANU binds to an ER and recruits an E3 ligase complex to tag the receptor with a chain of ubiquitin proteins. Next, the ubiquitin tagged ER is then recognized and eliminated by the proteasome, the cell's natural waste, allowing a single PROTAC to degrade many ERs.

Because of VEPPANU's unique design and mechanism of action, it is the first in a novel pharmacologic class of heterobifunctional protein degraders, which is differentiated from other estrogen receptor antagonists, which only bind to the estrogen receptors. Moving on to slide 15. I'd like to review the significant patient opportunity for VEPPANU. There are an estimated 170,000 patients in the U.S. living with metastatic breast cancer, and approximately 70%, or 119,000 patients, have ER-positive, HER2-negative disease. The standard of care typically includes endocrine therapy and a CDK4/6 inhibitor, and over time, up to 50% of patients may develop an ESR1 mutation. In VERITAC-2, all patients had received endocrine therapy and a CDK4/6 inhibitor, and 43% had an ESR1 mutation. Using approximately 40% as a benchmark, more than 47,000 ER-positive, HER2-negative patients could have the ESR1 mutated disease.