Geron Corporation’s Earnings Call: Mixed Sentiments and Strategic Moves

Geron Corporation ((GERN)) has held its Q1 earnings call. Read on for the main highlights of the call.

Geron Corporation’s recent earnings call revealed a mixed sentiment, reflecting both optimism and challenges. While there are promising signs of growth and strategic investments to enhance RYTELO’s market presence, concerns arise from the decline in Q1 revenues, challenges in physician adoption, and reliance on third-party support in the EU. The ongoing executive transition further adds to the uncertainty surrounding the company’s future direction.

RYTELO U.S. Commercial Launch

RYTELO, recently approved as a first-in-class novel telomerase inhibitor for lower risk MDS, presents a significant market opportunity. Despite initial sales not meeting expectations, Geron is making strategic investments and adjustments to enhance its commercial success. The company is committed to overcoming early hurdles and capitalizing on RYTELO’s potential.

Increased Commercial Investments

Geron is ramping up its efforts to increase brand awareness among U.S. hematologists by investing additional resources. This includes expanding the sales team by more than 20% and implementing new roles to drive product uptake. These efforts aim to strengthen RYTELO’s market position and boost sales performance.

Encouraging Performance Indicators

There are positive signs for RYTELO’s growth, with approximately 900 sites of care having utilized the product, including about 300 new sites since the end of Q4. Demand grew approximately 10% in the recent four-week period, marking the highest growth since October 2024, indicating a positive trajectory for the product.

Phase III Pivotal Trial in Myelofibrosis

The IMPACT MS Phase III trial in relapsed refractory myelofibrosis is a critical initiative designed to double RYTELO’s commercial potential. With about 85% enrollment completed, an interim analysis is expected in the second half of 2026, which could significantly impact the company’s future prospects.

Strong Financial Position

Geron remains in a robust financial position, with $457.5 million in cash and equivalents. The company also has access to additional funding under its debt agreement with Pharmacon if needed, providing a cushion to support its strategic initiatives.

RYTELO Q1 Net Revenue Decline

Q1 RYTELO net revenues were $39.4 million, down $8 million from Q4 due to inventory drawdown among distributors. Demand was relatively flat, with only a 1% increase over the prior 13 weeks, highlighting the challenges the company faces in boosting sales.

Challenges in Physician Adoption

There is hesitancy among some physicians to switch from standard care to RYTELO, primarily due to a lack of awareness and concerns about cytopenia management. Addressing these challenges is crucial for improving RYTELO’s adoption rates.

EU Commercial Strategy Requires Third-Party Support

Geron does not plan to independently commercialize RYTELO in Europe, relying instead on third-party partners. This strategy could slow expansion outside the U.S., posing a challenge to the company’s international growth ambitions.

Executive Leadership Transition

The company is in the process of identifying a permanent Chief Executive Officer, with an announcement expected within the next six months. This transition period adds a layer of uncertainty to the company’s strategic direction.

Forward-Looking Guidance

During the earnings call, Geron provided guidance on its strategic focus and performance metrics. Despite a decrease in Q1 net revenues for RYTELO, recent metrics indicated a promising 10% demand increase in April. The company is expanding its customer-facing teams by over 20% to improve reach and messaging, with new hires expected to be operational in Q3. Additionally, Geron is advancing its Phase III trial in relapsed refractory myelofibrosis, with an interim analysis anticipated in the second half of 2026. Operating expenses for 2025 are projected to be between $270 million and $285 million, with the company maintaining a strong financial position.

In summary, Geron Corporation’s earnings call highlighted a mixed sentiment with both opportunities and challenges. While strategic investments and promising growth indicators provide optimism, the decline in Q1 revenues, physician adoption challenges, and reliance on third-party support in the EU present hurdles. The ongoing executive transition further adds to the uncertainty, making it a pivotal time for the company’s future direction.