Financial Data and Key Metrics Changes - The company reported net Vyjuvek revenue of $97.8 million for Q3 2025, reflecting sustained growth compared to the previous quarter, including early sales from the German launch [9][26] - Gross margin improved to 96% for the quarter, up from 93% in the prior quarter, due to manufacturing process optimizations in the U.S. [26] - Net income for the quarter was $79.4 million, translating to $2.74 per basic share and $2.66 per diluted share, influenced by one-time benefits from tax adjustments [28][29] Business Line Data and Key Metrics Changes - Vyjuvek's total net revenues since launch exceeded $623 million, with significant contributions from the U.S. and early traction in Europe [9][10] - The company added over 40 new reimbursement approvals in the U.S., bringing the total to over 615, indicating a strong acceleration in reimbursement approvals [10][26] Market Data and Key Metrics Changes - The launch of Vyjuvek in Germany has seen approximately 20 patients prescribed since late August, with broad prescribing patterns across over 10 centers [12] - In France, Vyjuvek received early access approval and was launched, with the potential for pricing discussions following its ASMR 3 designation [13][14] Company Strategy and Development Direction - The company is focused on expanding its global footprint with Vyjuvek, having launched in Germany, France, and Japan, and is also contracting with regional specialty distributors for broader market access [16][17] - The strategic emphasis is on accelerating patient access to therapy and expanding the prescriber network, with over 450 prescribers now in the U.S. [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term growth trajectory of Vyjuvek, anticipating continued revenue growth and successful clinical pipeline advancements [30] - The company is optimistic about upcoming readouts in cystic fibrosis and other pipeline programs, indicating a robust clinical development strategy [30][31] Other Important Information - The company revised its full-year non-GAAP R&D and SG&A guidance to $145-$155 million, reflecting improved performance and confidence in execution [27] - The FDA granted a platform therapy designation for the HSV-1 gene delivery platform, which could expedite the approval process for related programs [18][19] Q&A Session Summary Question: What is the focus for the ex-U.S. launch? - The company aims to accelerate patient access by expanding the breadth of prescribers while also deepening relationships with existing prescribers [34] Question: What optimizations led to better gross margins? - The optimization involved moving to a larger bioreactor, with plans to apply for approval in Europe based on U.S. data [34][36] Question: What are the expectations for ex-U.S. revenue contributions? - The company anticipates steady growth in ex-U.S. markets, with Germany showing promising early results [39] Question: How is the NK trial progressing? - Enrollment has started, with a focus on adding sites globally to facilitate patient recruitment [44] Question: What are the expectations for the CF program? - The company plans to report on a minimum of three null patients, focusing on molecular correction as a success metric [48] Question: Will there be revenue guidance for Vyjuvek in 2026? - The company will not provide revenue guidance for 2026 due to the complexity of multiple launches [57] Question: Can you provide a breakdown of U.S. and ex-U.S. sales for Vyjuvek? - The company did not break down sales this quarter but plans to do so in 2026 as contributions grow [59]

Third Quarter 2025 Financial and Operating Results November 3, 2025 © Copyright 2025 Krystal Biotech, Inc. All rights reserved. Forward Looking Statements and Disclosures This presentation and our discussion contain forward-looking statements that involve substantial risks and uncertainties. Any statements about future expectations, plans, and prospects for Krystal Biotech, Inc. (together with its subsidiaries, the "Company"), including but not limited to, statements about our U.S. launch of VYJUVEK, includ ...

Core Insights - The FDA granted platform technology designation to Krystal Biotech's genetically modified HSV-1 viral vector used in the gene therapy KB801 for neurotrophic keratitis [1][2][3] Group 1: FDA Designation and Implications - The platform technology designation is a significant milestone for Krystal Biotech, recognizing the reproducibility and scalability of their HSV-1 gene delivery platform [2] - This designation may provide development efficiencies, including early engagement with the FDA and the ability to leverage data from previously approved products like VYJUVEK [2][3] - The program aims to streamline drug development, manufacturing, and review processes for products utilizing designated platform technologies [3] Group 2: About KB801 - KB801 is a redosable eye drop gene therapy designed to enable sustained expression of nerve growth factor (NGF) for treating neurotrophic keratitis, a rare corneal disease [4] - The therapy aims to reduce the treatment burden on patients by allowing local production of NGF, addressing the limitations of current recombinant NGF eye drops that require frequent administration [4] - The safety and efficacy of KB801 are currently being evaluated in the EMERALD-1 Phase 1/2 study, which is a randomized, double-masked, multicenter, placebo-controlled trial [4] Group 3: Company Overview - Krystal Biotech is a global biotechnology company focused on developing genetic medicines for diseases with high unmet medical needs [5] - The company’s first commercial product, VYJUVEK, is the first redosable gene therapy approved in the U.S., Europe, and Japan for dystrophic epidermolysis bullosa [5] - Krystal Biotech is advancing a pipeline of investigational genetic medicines across various therapeutic areas, including respiratory, oncology, dermatology, ophthalmology, and aesthetics [5]

Core Viewpoint - Krystal Biotech, Inc. has shown a positive performance with an 8.5% increase in shares since the last earnings report, outperforming the S&P 500, but faces concerns regarding future revenue guidance [1][2]. Financial Performance - The company reported Q2 2025 earnings per share (EPS) of $1.29, exceeding the Zacks Consensus Estimate of $1.08, and up from $0.93 in the same quarter last year [3]. - Revenues reached $96 million, a 36.6% year-over-year increase, surpassing the Zacks Consensus Estimate of $91 million, with all revenues derived from Vyjuvek sales [3]. - Despite strong quarterly results, shares fell by 14% due to soft guidance for third-quarter revenues [4]. Product Developments - Vyjuvek, the first-ever revocable gene therapy for dystrophic epidermolysis bullosa (DEB), received FDA approval in 2023 and has secured over 575 reimbursement approvals in the U.S. as of July [5]. - The European Commission approved Vyjuvek for treating DEB-related wounds, with launches planned in Germany and France in Q3 and Q4 respectively [7]. - Vyjuvek was also approved in Japan for DEB treatment, with a target launch before the end of 2025 [7]. Research and Development - Research and development expenses were $14.4 million, down 7.5% year-over-year, while selling, general, and administrative expenses rose to $35.2 million, a 27.2% increase from the previous year [6]. - The company is evaluating KB407 for cystic fibrosis, with four patients enrolled in a study, and expects interim data before year-end [8]. - KB408 is being assessed for alpha-1 antitrypsin deficiency, with positive results reported in a patient from a dose escalation study [9]. Pipeline Progress - Krystal Biotech is advancing multiple candidates, including KB801 for neurotrophic keratitis and KB707 for solid tumors, with ongoing enrollment in various studies [11][12]. - Jeune Aesthetics, a subsidiary, reported positive results for KB304 in treating décolleté wrinkles, leading to its progression into phase II studies [13][14]. Market Outlook - Since the earnings release, there has been a downward trend in estimates, with a consensus estimate shift of -16.13% [15]. - The stock has an average Growth Score of C, a Momentum Score of F, and a Value Score of D, resulting in an aggregate VGM Score of F [16]. - Krystal Biotech holds a Zacks Rank 3 (Hold), indicating expectations for an in-line return in the coming months [17][18].

Core Insights - Krystal Biotech reported Q2 2025 EPS of $1.29, exceeding the Zacks Consensus Estimate of $1.08, and up from $0.93 in the same quarter last year [1][8] - Revenues reached $96 million, a 36.6% increase year over year, surpassing the Zacks Consensus Estimate of $91 million, driven solely by Vyjuvek sales [1][8] - Despite strong quarterly results, shares fell 14% due to soft guidance for Q3 revenues [2][17] Financial Performance - Gross margin for the reported quarter was 93% [5] - Research and development expenses were $14.4 million, down 7.5% year over year [5] - Selling, general and administrative expenses increased by 27.2% to $35.2 million, attributed to higher professional services fees [5] - As of June 30, 2025, cash, cash equivalents, and investments totaled $820.8 million, up from $765.3 million as of March 31, 2025 [6] Product Developments - Vyjuvek, the first revocable gene therapy for dystrophic epidermolysis bullosa (DEB), received FDA approval in 2023 and has over 575 reimbursement approvals in the U.S. as of July [4][9] - The European Commission approved Vyjuvek for DEB treatment, with launches planned in Germany and France in Q3 and Q4 respectively [9] - Vyjuvek was also approved in Japan for DEB treatment, with a target launch before the end of 2025 [9] Pipeline Progress - Krystal Biotech is advancing multiple gene therapy candidates, including KB407 for cystic fibrosis and KB408 for alpha-1 antitrypsin deficiency, with ongoing clinical trials [10][11] - Enrollment is ongoing for various studies, including EMERALD-1 for KB801 and KYANITE-1 for inhaled KB707 [13][14] - Jeune Aesthetics, a subsidiary, is developing KB304 for aesthetic treatments, with positive results from the PEARL-2 study leading to progression into phase II [15][16] Market Outlook - Despite a strong Q2 performance, revenues are expected to decline in Q3 due to seasonal trends, but growth is anticipated to resume in Q4 [17]

Financial Data and Key Metrics Changes - Q2 net revenue was $96 million, marking a return to growth due to patients resuming treatment and ongoing sales team expansion [7][8] - Total net revenue for Visovac since launch exceeded $525 million [7] - Net income for the quarter was $38.3 million, representing $1.33 per basic and $1.29 per diluted share, compared to $15.6 million in the prior year's second quarter [30] Business Line Data and Key Metrics Changes - Gross margin remained consistent at 93% in Q2 [29] - Research and development expenses decreased to $14.4 million from $15.6 million in the prior year, while general and administrative expenses increased to $35.2 million from $27.6 million [29] Market Data and Key Metrics Changes - Compliance while on drug was reported at 82%, with expectations of a downward trend as the patient mix shifts [9] - The company secured over 575 reimbursement approvals for patients in the U.S. [8] Company Strategy and Development Direction - The company is focused on the successful launch of Visovac in Europe and Japan, with significant potential for growth in these markets [12][18] - The strategy includes expanding the sales force and enhancing patient support programs to drive adoption [10][15] Management's Comments on Operating Environment and Future Outlook - Management expects Q3 revenues to be below Q2 due to seasonal trends but anticipates a return to growth in Q4 [10] - The company is optimistic about the long-term growth trajectory driven by transformative patient outcomes and global expansion [11][18] Other Important Information - The approval of VYZUVAC in Japan is seen as a significant milestone, with plans for launch before year-end [12] - The company has established dedicated commercial teams in Germany and France for the European launch [14] Q&A Session Summary Question: Was the revenue growth for this quarter impacted by the Salesforce expansion? - Management clarified that part of the increase in Q2 was due to patients resuming treatment, and the full impact of the Salesforce expansion will be felt in the coming quarters [36] Question: Can you provide quantitative commentary on the magnitude of slower growth in the first few weeks of the quarter? - Management refrained from providing specific details, noting that summer vacations typically lead to increased treatment pauses [40] Question: What is the mix of RDEB versus DDEB patients in reimbursement approvals? - The mix was reported to be approximately 64% RDEB and 36% DDEB, with no significant changes noted [42] Question: How do drug holidays factor into the guidance for U.S. patients initiating VYJUVEC? - Management indicated that they are on track but may be a quarter or two behind the original timeline [46] Question: Will patients need to see a healthcare practitioner before initiating VYJUVEC in Japan? - Yes, the process is similar to Europe, requiring an initial visit to a physician [70] Question: What is the compliance rate among patients using different vial counts? - Compliance is defined based on the duration of drug use, with a range of 76% to 84% expected [101] Question: What are the timelines to capture the remaining patient base in the U.S. market? - Management emphasized that the goal is to target the entire 1,200 patient base, with ongoing efforts to reach the remaining patients [92]

Financial Performance & VYJUVEK Launch - VYJUVEK revenue since launch exceeds $525 million[8] - Second quarter 2025 product revenue reached $96 million, compared to $70.3 million in the second quarter of 2024[43] - Gross margin in the second quarter was 93%[10, 43] - Gross to net in the second quarter was 17%[10] VYJUVEK Expansion & Approvals - VYJUVEK received approval in Japan for DEB patients from birth, with launch expected in the fourth quarter of 2025[11, 14] - Over 575 reimbursement approvals in the U S[10] - U S compliance to weekly therapy while on drug at 82% as of end of 2Q 2025[10] - European launch is on track for later this quarter, with over 575 identified DEB patients in Germany and France[15, 16] Pipeline Development - 36% objective response rate was observed with KB707 monotherapy in advanced NSCLC patients[22] - 40% AAT positive cells after KB408[26] - Functional AAT delivery to the lungs was confirmed in the third patient dosed with KB408, showing a 79.3% reduction in free neutrophil elastase in ELF after a single dose[25, 26] Financial Guidance - Non-GAAP R&D and SG&A expense guidance for the full year 2025 is $150 million to $175 million[44]

Financial Performance - The company reported $96.0 million in net product revenue for the second quarter of 2025, a significant increase from $70.3 million in the same quarter of 2024, representing a growth of approximately 36% [20][38] - For the six months ended June 30, 2025, net product revenue totaled $184.2 million, compared to $115.5 million for the same period in 2024, indicating a year-over-year increase of about 61% [18][39] - The gross margin for the second quarter was 93%, reflecting strong profitability [6] - The company ended the quarter with a robust balance sheet, holding $820.8 million in cash and investments [20][37] Product Developments - VYJUVEK, the company's gene therapy product, has been approved in Japan for the treatment of dystrophic epidermolysis bullosa (DEB) patients from birth, with plans to launch before the end of 2025 [6][23] - The company has secured over 575 reimbursement approvals for VYJUVEK in the U.S., maintaining strong access nationwide [6] - VYJUVEK is also set for its first European launch in Germany in the third quarter of 2025 and in France in the fourth quarter of 2025 [6][34] Clinical Trials and Pipeline - The company is actively enrolling patients in various clinical trials, including KB407 for cystic fibrosis and KB408 for alpha-1 antitrypsin deficiency lung disease, with interim data expected before year-end [5][7] - The company has initiated a Phase 3 study for KB803, aimed at treating and preventing corneal abrasions in DEB patients, with ongoing enrollment [13] - In oncology, the company continues to evaluate inhaled KB707 in patients with solid tumors, with promising safety and efficacy data reported [11][19] Management Commentary - The CEO highlighted the company's global expansion plans following VYJUVEK's approvals in Europe and Japan, which are expected to enhance access for DEB patients worldwide [2] - The company is approaching key readouts in both lung and eye treatments, which could have transformative implications for its platform and patient care [2]

Company Overview - Krystal Biotech (KRYS) announced the dosing of the first patient in a phase I/II study for its eye drop KB801, aimed at treating neurotrophic keratitis (NK), a rare corneal disease [1][7] - KB801 is a redosable gene therapy designed to enhance nerve growth factor (NGF) production in the eye, promoting corneal healing and preventing complications associated with NK [2][8] Market Context - NK affects an estimated 10 to 50 individuals per 100,000, with increasing awareness and diagnosis in the U.S.; claims for NK reached approximately 68,000 in 2024, up from 31,000 in 2020 [3] - Year-to-date, KRYS shares have declined by 5%, while the industry has seen a 2% decline [6] Clinical Development - The EMERALD-1 study is a double-masked, placebo-controlled trial evaluating the safety and tolerability of KB801 in up to 27 adults with NK [7][8] - This study represents a significant step towards providing a simple eye drop treatment option for patients with NK [8] Other Developments - In addition to KB801, Krystal Biotech is also advancing its phase III IOLITE study for KB803, another investigational eye drop treatment for corneal abrasions in dystrophic epidermolysis bullosa (DEB) [9] - The company's only marketed product, Vyjuvek, is FDA-approved for treating DEB in patients aged six months and older [10]

Neurotrophic Keratitis (NK) Market & KB801 Opportunity - The number of patients in the U S with at least one NK claim has increased by over 115% from 31,000 in 2020 to an estimated 68,000 in 2024[9, 10] - In 2023, U S Medicaid and Medicare spent over $540 million on Oxervate, the only FDA-approved therapy for NK[12] - An estimated over 410,000 days of Oxervate therapy were reimbursed in the U S in 2024[12] - KB801 is designed to address the shortcomings of Oxervate, aiming for superior NGF exposure with significantly reduced dosing frequency[11, 21] KB801 Preclinical Data - KB801 transduces primary human corneal epithelial cells in vitro, leading to dose-dependent expression and secretion of mature NGF[25, 26, 29] - In vitro studies confirmed functionality of secreted NGF using a growth factor starved cell proliferation assay[25, 30] - Topical administration of KB801 to wounded murine corneas was well-tolerated and resulted in localized NGF expression[25] - Head-to-head mouse PK studies demonstrated a clear durability advantage with KB801 compared to recombinant NGF, even against intensive recombinant dosing[43, 47] KB801 Clinical Development - The EMERALD-1 study is a Phase 1/2 double-masked, 2:1 randomized, placebo-controlled study in patients with moderate-to-severe NK, with the first patient dosed in July 2025[51, 53, 1] - Krystal is pursuing Platform Technology Designation with the FDA, potentially leading to expedited development of KB801[56, 57]