Cyberattack Impact on Treatment Volume and Revenue
Cyber incident caused a spike in missed treatment rates, especially in May, leading to a revision of treatment growth outlook from -50 bps to -75 to -100 bps for the year.
The cyber event's impact on revenue per treatment was approximately $40-50 million in Q2, with expectations that the impact on revenue per treatment will be contained in the second half of the year.
The incident led to manual processes, delays, and issues with claim approvals, affecting revenue collection and treatment volume.
Management believes the cyber impact on treatment volume and revenue is largely behind them, with limited ongoing effects expected.
Adjusted EBITDA increased 10% year-over-year to $100 million, and adjusted EPS rose to $2.10 from $1.56 last year.
Debt was reduced by $250 million year-to-date, with $200 million of JV proceeds used to pay down Term Loan A.
Free cash flow was a net outflow of $8 million in Q2, impacted by working capital timing, tax payments, and tariffs.
Gross margin expanded by 3 percentage points year-over-year to 40%, driven mainly by the JV deconsolidation and integration synergies.
ICU Medical reported Q2 2025 revenue of $544 million, with 2% organic growth and a 6% decline reported due to the IV Solutions joint venture deconsolidation.
ARCALYST collaboration profit grew 75% year-over-year to $104.8 million in Q2 2025, driven by sales volume and disciplined commercial investments.
ARCALYST net revenue was $156.8 million in Q2 2025, a 52% year-over-year increase driven by new patient enrollments, prescribers, and active commercial patients.
Cash balance increased by approximately $40 million to $307.8 million in Q2 2025, with expectations to remain cash flow positive on an annual basis.
Net income was $17.8 million in Q2 2025 compared to a net loss of $3.9 million a year ago, reflecting strong revenue growth and moderate expense growth.
Operating expenses grew 26% year-over-year due to cost of goods sold, collaboration expenses, and SG&A supporting ARCALYST commercialization.
Cash, cash equivalents, and marketable securities totaled $614 million at the end of Q2 2025, down from $714 million at the end of 2024, primarily due to completion of a $200 million share repurchase program.
Dynavax reported record Q2 2025 net product revenue for HEPLISAV-B at $92 million, a 31% increase year-over-year.
GAAP net income was $19 million in Q2 2025 compared to $11 million in Q2 2024.
HEPLISAV-B gross margin improved to 85% in Q2 2025 from 83% in Q2 2024, with full-year 2025 gross margin expected around 80%.
Non-GAAP adjusted EBITDA improved to $37 million in Q2 2025 from $20 million in Q2 2024.
R&D expenses increased slightly to $17 million in Q2 2025 from $15 million in Q2 2024, reflecting pipeline progress.
SG&A expenses rose to $50 million in Q2 2025 from $42 million in Q2 2024, mainly due to $13 million in proxy contest-related costs.
Total revenues for Q2 2025 were approximately $95 million, up 29% year-over-year.
Regulatory and External Factors Influencing Growth and Development
The company discussed the impact of ACIP recommendations on expanding the hepatitis B market and the importance of policy changes, such as Medicare coverage updates, in supporting growth.
Dynavax's development programs, including shingles, influenza, Lyme disease, and plague vaccines, are aligned with regulatory pathways, with key data readouts expected in the coming months and years.
The company emphasizes its reliance on external collaborations and government partnerships, particularly with the U.S. Department of Defense, for advancing its vaccine pipeline.
Adjusted EBITDA improved to $9.1 million from a loss of $0.3 million in Q2 2024.
Adjusted revenue for Q2 2025 was $90.5 million, up 14% year-over-year excluding prior period test revenue adjustments.
Cash from operations was $10 million, ending the quarter with $186 million in cash and no debt after a $50 million share repurchase.
Non-GAAP gross margin improved by 340 basis points to 70.4%, with Testing Services margin at 77.6%, Patient & Digital Solutions at 39.5%, and Lab Products at 63.9%.
Operating expenses increased 3% year-over-year to $56.7 million, well below revenue growth, reflecting operational leverage.
Patient & Digital Solutions revenue grew 19% to $12.8 million, and Lab Products revenue increased 12% to $11.8 million.
Reported revenue was $86.7 million, including a $3.8 million write-off related to prior period tests, down 6% year-over-year.
Testing Services revenue was $66 million adjusted, up 14% year-over-year with approximately 49,500 tests delivered, marking the eighth consecutive quarter of volume growth.
Gross margin was 31% excluding noncash items, with expectations for improvement due to restructuring and manufacturing optimization.
Iovance reported $60 million in total revenue for Q2 2025, a 22% increase over the prior quarter, with $54 million from Amtagvi infusions and $6 million from Proleukin.
Net cash burn is expected to be less than $245 million over the next four quarters, with a cash position of approximately $307 million sufficient to fund operations into Q4 2026.
Operating expenses increased to approximately $117 million from $102 million year-over-year, driven by higher headcount, clinical trials, and marketing costs.
The company announced a strategic restructuring including a 19% workforce reduction expected to generate over $100 million in annual cost savings starting Q4 2025.
Cash and equivalents declined to $52 million from $109.1 million at year-end 2024.
Gross to net provisions improved to 26.8% in Q2 2025 from 45% in Q1 2025 and 29.3% in Q2 2024, driven by mix and lower 340B discounts.
Interest expense increased to $11.2 million from $8.9 million due to refinancing impacts.
Net loss was $37.3 million or $4.32 per share, including $11.2 million interest expense and $2 million noncash losses from warrant and derivative remeasurement.
R&D expenses decreased 15% to $32.8 million due to headcount reductions and lower clinical trial costs.
SG&A expenses decreased 8% to $28.5 million reflecting cost reduction initiatives.
Total revenue for Q2 2025 was $37.9 million, down from $42.8 million in Q2 2024, primarily due to $6 million of nonrecurring license revenue in 2024.
U.S. XPOVIO net product revenue increased 6% year-over-year to $29.7 million in Q2 2025.
Dafinchi