GLAUKOS Corp Q3 FY2026 earnings call

• Commercial Execution & Launches:
  • Epioxa launched strongly with $53M in Q3 sales; site-of-care network now covers ~90% of the US population via O2N systems, with contracts for >300 sites.
  • Payer access established for ~90% of commercial lives and ~80% of Medicaid lives; focus shifting from initial access to optimizing adjudication timelines.
  • iDose-TR continues robust growth ($76M in Q3); positive Phase 4 data released showing superior IOP reduction when combined with cataract surgery.
  • International franchise scaling steadily with broad-based growth across major markets.
• Strategic Initiatives & Awareness:
  • Launched "Could It Be KC" campaign with Stephen Curry to drive disease awareness and earlier diagnosis.
  • Planning launch of KC screening devices in 2027 to democratize detection among optometrists (>50,000 offices).
  • Expanding specialty pharmacy and patient support infrastructure (Epioxa Care Connect) to streamline reimbursement.
• Pipeline Progress:
  • Retinal: Exclusive licensing agreement with RevOps Therapeutics for RO-104 (tri-specific biologic) and RevMod platform.
  • iLink Platform: Preparing Phase 3 program for third-gen customized tomography-guided cross-linking therapy in 2027.
  • iStent: Completed enrollment in pivotal trials for iStent Infinite (mild/moderate glaucoma) and pressor flow micro shunt.
  • iLLUSION: Completed enrollment in Phase 2 study for demodex blepharitis; top-line results expected end of year.
• Financial Discipline:
  • Gross margins expanded to ~88% due to favorable product mix.
  • Operating expenses guided to grow 25-30% in Q4, maintaining operating leverage.
  • Strong cash generation ($50M+) and non-GAAP net income ($28.5M).

• Corneal Health Franchise: Net sales of $59 million, up 154% year-over-year. Revenue contribution was approximately 28% of total consolidated net sales. Growth driven by Epioxa, which generated ~$53 million in its first full quarter post-J-code implementation.
• U.S. Glaucoma Franchise: Net sales of $118.6 million, up 47% year-over-year. Revenue contribution was approximately 56% of total consolidated net sales. Growth driven by iDose-TR, which generated ~$76 million.
• International Glaucoma Franchise: Net sales of $33.4 million, up 13% year-over-year (15% constant currency). Revenue contribution was approximately 16% of total consolidated net sales.

• Full Year 2026 Net Sales: Raised to $775–$785 million (midpoint increase of $90 million vs. prior guidance of $680–$700 million).
• Preliminary 2027 Revenue Guidance: Introduced highly preliminary outlook of $1 billion.
• iDose-TR Full Year 2026: Revised upward to low $280s (previously $275–$280 million).
• Operating Expenses 2026: Expected to land around $630 million (+/-), representing ~30% YoY growth.

• Reimbursement Uncertainty: Pending Local Coverage Determinations (LCDs) for iDose-TR remain a key risk; MACs have one year from draft date to act or abandon.
• Market Adoption Speed: Early-stage launches like Epioxa face challenges with payer prior authorization delays and complex reimbursement workflows.
• Clinical/Regulatory Risks: Pipeline assets (e.g., retinal biologics, iDose Trio) require successful clinical trials and FDA approvals to realize long-term value.
• Operational Scaling: Rapid demand for Epioxa has strained field support and operational teams, requiring rapid scaling to maintain service levels.

Q: Analyst asked about confidence behind the preliminary $1B 2027 revenue guide given early Epioxa stage and potential iDose LCD restrictions.

A: COO Joe Gilliam stated that management evaluated all scenarios, including downside cases with restrictive LCDs, and still saw paths to $1B. They provided this early look to give investors a benchmark for modeling, noting that historical investor enthusiasm often outpaces ground realities during new product launches.

Q: Analyst sought details on Epioxa launch metrics, specifically account adoption, payer approval rates, and market awareness timing.

A: Gilliam reported >200 active sites of care covering 90% of the US pop, with contracts for >300. Payer pathways cover 90% commercial and 80% Medicaid lives. He noted that while prior auth processes are currently slow as payers learn the system, volume will drive efficiency. Significant investment in disease awareness (e.g., Stephen Curry campaign) is planned for 2027.

Q: Analyst asked how SG&A will evolve given strong Q3 results without proportional spend increases, and what to expect for 2027.

A: CFO Alex Thurman guided Q4 opex growth at 25-30%, maintaining operating leverage. CEO Tom Burns emphasized an 'organic development first' strategy, citing massive internal R&D investments (>$100M per major retinal asset) rather than M&A, ensuring cash flow fuels internal pipeline expansion.

Q: Analyst questioned if iDose ASPs would change and how new clinical data impacts the LCD process.

A: Gilliam maintained the modeled net ASP of $65k-$70k for Epioxa. CEO Burns explained the new cataract combo study serves as an 'insurance policy' against potential LCD restrictions on combinatorial use. They are also preparing a study comparing iDose+iStent vs iDose alone to support appeals if MIGI combinations are restricted.