Sol‑Gel Technologies Ltd. reported third‑quarter 2025 revenue of $0.4 million, a 93 % drop from the $5.4 million earned in the same period last year. The decline is largely attributable to the termination of licensing agreements for its former commercial dermatology products, which previously generated $3.8 million under a Padagis agreement and $1.0 million from U.S. licensing of EPSOLAY and TWYNEO. The company’s royalty income from Galderma and Searchlight also fell to $0.4 million and $0.6 million, respectively, reflecting the end of those contracts. The sharp revenue contraction underscores the company’s pivot from a commercial product portfolio to a clinical‑stage pipeline.
Net loss for the quarter widened to $5.9 million, or $2.13 per share, driven by a $0.9 million increase in research and development expenses. The bulk of the R&D hike—$0.8 million—was spent on manufacturing development for the SGT‑610 Phase 3 trial, while $0.7 million was allocated to clinical trial costs for the same program. The loss margin reflects the company’s strategic investment in a potentially high‑revenue orphan drug, but it also signals short‑term financial pressure as the company depletes its commercial revenue base.
Cash, cash equivalents, and marketable securities stood at $20.9 million as of September 30, 2025, giving Sol‑Gel a runway that extends into the first quarter of 2027. The $16 million received from Mayne Pharma for U.S. rights to EPSOLAY and TWYNEO is earmarked to fund the SGT‑610 study and other clinical‑stage initiatives, allowing the company to focus resources on its flagship product and reduce exposure to legacy licensing income.
The Phase 3 trial of SGT‑610, a topical hedgehog inhibitor for Gorlin syndrome, is proceeding on schedule. Management expects top‑line results in the fourth quarter of 2026, and the drug has received U.S. Orphan Drug and Breakthrough Therapy designations. If approved, SGT‑610 could tap a U.S. market estimated at $400–$500 million annually and may also be positioned for high‑frequency basal cell carcinoma, potentially doubling its commercial upside.
Sol‑Gel also announced new licensing agreements in Australia and New Zealand with Viatris, expanding its EPSOLAY and TWYNEO distribution network. The company’s proprietary microencapsulation technology remains a key differentiator for future product development, reinforcing its strategic shift toward a focused clinical pipeline. Executive Chairman Mori Arkin said the company is “excited about the opportunity to double the potential of this important drug by adding the unmet need of high‑frequency BCC,” highlighting the dual therapeutic promise of SGT‑610.
Management emphasized that the company remains committed to cost discipline while investing heavily in the SGT‑610 program. The extended cash runway and the Mayne Pharma deal provide a buffer as the company navigates the high‑cost, high‑risk phase of clinical development. While the Q3 loss reflects the current investment phase, the company’s long‑term outlook hinges on the successful completion of the SGT‑610 trial and the subsequent commercialization of a potentially blockbuster orphan drug.
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