KORU Medical Systems, Inc. Q3 FY2025 earnings call

• Third-quarter highlights: Delivered strong results with over $10M revenue for second consecutive quarter, 27% Y/Y growth, core SCIG business grew 30%, advanced PST collaborations, made progress in oncology infusion space with successful US study.
• Strategic initiatives: Announced two new PST collaborations, made progress in expanding into oncology infusion centers with 510(k) filing target in 2026, advanced IG and non-IG drug pipelines.
• US SCIG business: External forecasts project SCIG market growth ~9% annually over five years, driven by new patients using SCIG as first-line therapy, broader diagnosis of secondary immunodeficiency, and pharma partner investments.
• International business: Grew international market share, saw success with prefilled syringe conversions in Europe, targets to accelerate market share from 40% range with $10M to $20M opportunity over several years.
• IG Pharma Partners: Seven active collaborations, two previous collaborations pushed launch dates to 2027 but no material impact on current revenue, recent collaboration expands potential into broader patient populations.
• Non-IG drugs pipeline: Nine active collaborations, rare disease candidate pushed to Q1 2026, expanded commercial potential for an Empivalli indication, announced collaboration with Forecast Ortho in orthopedic space.
• Oncology infusion space: Successful US pilot study in oncology infusion clinics with 100% administration success rate, high nurse and patient satisfaction, on track for 510(k) submission to FDA in 2026.

KORU achieved its second consecutive quarter with over $10 million in revenue, representing 27% year-over-year growth. The core subcutaneous immunoglobulin (SCIG) business grew 30% driven by international expansion, global share gains, and patient growth. International revenue grew by 230% this quarter, though there were quarterly shifts in domestic and international purchasing patterns. The core business overall had 30% growth. The US SCIG business is the largest recurring revenue base, with external forecasts projecting SCIG market growth of ~9% annually over five years. International business has growth potential with prefilled syringe conversions in Europe and targets to accelerate market share from the 40% range, representing a $10 million to $20 million opportunity over several years. IG Pharma Partners have seven active collaborations, and non-IG drugs pipeline has nine active collaborations with potential new drugs added by 2026, with estimated commercial potential up to $10 million by 2028.

• Raised full-year 2025 revenue guidance to $40,541,000, representing growth of approximately 20% to 22%.
• Reaffirmed guidance for gross margins in the range of 61% to 63% and positive cash flow from operations.
• Anticipates acceleration in 2026 driven by opportunities such as prefilled conversions, international expansion, oncology business, and new drugs, with a number starting with 2 expected for 2026 growth.

• Quarterly shifts in domestic and international purchasing patterns could impact revenue.
• Collaborations pushing launch dates to 2027 could have potential impact if not managed properly.
• Uncertainties in international market growth and expansion.
• Tariff impacts and manufacturing cost and yield fluctuations could affect gross margins.

Q: Frank Takkinen asked about nurse feedback in the oncology pilot and reimbursement in the oncology setting.

A: Linda Tharby said the oncology clinical study had positive outcomes across clinics, 70% of nurses reported ability to multitask, and reimbursement codes exist for administration of drugs in infusion clinics using a pump.

Q: Frank Takkinen asked about Q4 guidance.

A: Linda Tharby said front half growth was 19% and back half implied at midpoint of guidance at 23%, Tom Adams said split around 70% for US business and 23%-24% for international business in Q4.

Q: Caitlin Roberts asked about EU prefilled syringe conversion opportunities and timing.

A: Linda Tharby said international expansion has $10M to $20M opportunity driven by prefilled syringes, studies show 50% reduction in steps vs electronic pumps, and work ongoing in multiple countries.

Q: Joseph Dowling asked about gross margin development and Japan ramp.

A: Tom Adams said working on margin profile and aiming for 65%+ margins, Linda Tharby said Japan sales were ~$300,000-500,000, and prefilled syringes are major growth driver.

Q: Chase Knickerbocker asked about US core growth, SCIG market growth, and prefilled conversion cadence.

A: Linda Tharby said US core growth adjusted for $1,200,000, SCIG market growth in 8%-9% range, and prefilled conversions will happen country by country over next 18-24 months.