Krystal Biotech Shares Fall 11% Despite Vyjuvek Sales Growth to $127.3 Million
Key Facts
Krystal Biotech shares fell 11% in the November 2 session despite the company exceeding third-quarter estimates, a reaction that reflected pressure from the timing of its clinical programs even as sales of its main product grew. The company said global revenue from Vyjuvek reached $127.3 million for the quarter, up 30% from the same period a year earlier. By contrast, it said patient enrollment in the EMERALD-1 trial of a treatment for neurotrophic keratitis was slower than expected. The shares closed at $295.9 in the same session in which they recorded their decline, according to market data. Strong commercial growth and a falling share price thus coincided in one session as investors tracked trial progress and the timing of results.
Krystal Biotech said gross margin was 94% in the third quarter, alongside 30% growth in comparable annual Vyjuvek revenue. But product sales growth did not translate into higher net income than a year earlier: the company reported net income of $63.1 million, compared with $79.4 million in the third quarter of 2025. Diluted earnings per share were $2.05, compared with $2.66 in the year-earlier period. These figures show sales moving differently from net income and earnings per share during the period. The company ended the quarter with $1.2 billion in cash, cash equivalents and investments, according to its results statement.
The company attributed slower enrollment in EMERALD-1 to narrow eligibility criteria and the difficulty of recruiting participants for a placebo-controlled trial in a field where an approved treatment is available. It said 22 U.S. sites had been activated for the trial, and that it expects to complete enrollment of about 60 patients and announce topline results in 2027. This places the reason for slower enrollment, as described by the company, in the context of the study’s design and participation requirements. The announced timelines for other programs are spread across separate dates, and the company did not give one date combining their results. Progress in EMERALD-1 enrollment remains tied to reaching the target number before topline results, expected in 2027, are announced.
In the IOLITE trial, the company expects the last patient visit in February 2027, with topline results to be announced shortly afterward. For the KB407 cystic fibrosis program, it said three patients were receiving doses as of its November 2 statement, and that it expects interim results in the first half of 2027. These two milestones differ from the EMERALD-1 timeline, which targets enrollment of about 60 patients and results in 2027. The February and first-half 2027 dates provide separate timelines for tracking the two programs, while EMERALD-1 results are also expected during the same year. In October 2025, the U.S. Food and Drug Administration granted platform technology designation to the viral vector used in KB801, and the company said the designation could allow it to leverage manufacturing and safety data from approved products.
Alongside its development updates, Krystal Biotech’s board authorized a share repurchase program of up to $400 million. The chief executive said the company expects to make purchases over the next two years, noting that buying would depend on available opportunities. The program comes alongside cash and investments totaling $1.2 billion at the end of the third quarter, according to the company. For the trials, the next announced milestones are EMERALD-1 results during 2027, the expected last patient visit in IOLITE in February 2027, and interim KB407 results in the first half of 2027. The shares fell on November 2 despite Vyjuvek sales growth and the company exceeding quarterly estimates, as investors weighed an expanding commercial business against clinical timelines extending into 2027.