Summary of Harrow's Q2 2026 Earnings Call

1Key Financial Results and Metrics

Q2 Revenue: $70.7 million, up 11% year-over-year and approximately 60% sequentially.

First Half Revenue: Approximately $115 million, lighter than expected due to VEVYE net revenue impacts.

VEVYE Revenue: $29.4 million for Q2, up nearly 58% year-over-year.

IHEEZO Revenue: $15.6 million, with record unit demand and new account growth.

Gross Margin: GAAP gross margin at 71%, expected to trend towards high 70s in the second half.

Adjusted EBITDA: Negative $1.2 million.

Cash Position: $83.9 million at quarter-end.

Full Year Guidance: Reiterated revenue guidance of $350 million to $365 million and adjusted EBITDA of $80 million to $100 million.

2Strategic Updates and Business Highlights

Commercial Expansion: Significant growth in the commercial organization, doubling the sales force for VEVYE.

Product Launches: Byooviz launched on July 1, with positive early reception; TYRVAYA acquisition expected to enhance the dry eye franchise.

VEVYE and IHEEZO: Both products are positioned for stronger growth, with IHEEZO achieving record demand and improved pricing.

Acquisition of TYRVAYA: Expected to strengthen the dry eye portfolio, with a unique tolerability profile and no contraindications.

Pipeline Development: Progress on G-MELT (MELT-300) and YoChill (MELT-210) with upcoming NDA submissions anticipated.

3Forward Guidance and Outlook

Second Half Expectations: Revenue growth anticipated in both Q3 and Q4, with a larger increase expected in Q4.

Revenue Drivers: IHEEZO, VEVYE, and TRIESENCE are expected to contribute significantly to revenue growth.

TYRVAYA Contribution: Modest revenue expected in 2026, with a projected contribution of over $30 million in 2027.

4Bad News, Challenges, or Points of Concern

First Half Performance: Revenue was lighter than expected, primarily due to VEVYE's net revenue impact.

Market Dynamics: The loss of pass-through reimbursement for IHEEZO may limit its surgical market potential.

Integration Costs: Initial costs associated with the TYRVAYA acquisition may impact short-term profitability.

Competitive Pressures: The dry eye market is competitive, and maintaining pricing and market share will be critical.

5Notable Q&A Insights

PBM Coverage: New coverage from a top 3 PBM is expected to significantly increase access to VEVYE, with millions of previously blocked lives now accessible.

IHEEZO Demand: Strong demand driven by both retina practices and in-office procedures, with expectations for continued growth.

VEVYE ASP: Anticipated improvement in average selling price (ASP) due to revised business rules and expanded coverage.

TYRVAYA Sales: Current sales data for TYRVAYA are limited until the acquisition is finalized, but expected to be accretive post-integration.

Pipeline Developments: Upcoming pre-NDA meetings for G-MELT and YoChill are crucial for advancing their respective regulatory submissions. Overall, Harrow is positioned for a stronger second half of 2026, with multiple growth drivers and strategic initiatives in place, despite some challenges and uncertainties in the market.