A favorable regulatory resolution with federal health authorities is clearing the way for Incyte’s Opzelura cream to reach blockbuster land ahead of schedule.
Thanks to a settlement with the Centers for Medicare & Medicaid Services on the classification of Opzelura, Incyte raised its full-year 2026 sales guidance for Opzelura to between $1.05 billion and $1.1 billion, compared to below $800 million in its previous projections.
The raise comes after the topical eczema and vitiligo treatment’s second-quarter sales enjoyed a one-time, $246 million boost stemming from the Medicaid rebate settlement. While total sales reached $450 million, the underlying sales of $204 million marked a 24% increase year on year.
The June settlement saw CMS agree not to label Opzelura as a line extension of its oral myelofibrosis sister med, Jakafi, when determining its rebate. Incyte expects this to deliver an additional benefit of $40 million to $50 million for the rest of the year.
Despite the positive development, Incyte CEO Bill Meury cautioned that the overall market remains in fluctuation.
“We continue to view the pricing and reimbursement environment as dynamic, so maintaining broad access and a disciplined gross-to-net profile remains a priority,” he said on Incyte’s July 28 earnings call.
A boon from reimbursement did not outshine the underlying expansion of Opzelura, either. In the U.S., Meury highlighted a 26% gain in prescription volume year over year, as Opzelura captured 46% of new-to-brand share among branded topical treatments.
Outside the U.S., Opzelura sales reached $43 million in the second quarter, up 34% year over year. The momentum is expected to accelerate as the European Commission just approved Opzelura to treat moderate atopic dermatitis in patients for whom topical corticosteroids and calcineurin inhibitors don’t work.
Incyte continues to see long-term growth potential for Opzelura in the international market that could reach two to three times where it is today, Meury said.
In another potential catalyst, Incyte expects a phase 3 readout this year for Opzelura in mild to moderate hidradenitis suppurativa, an inflammatory skin condition that causes painful, boil-like lumps. If successful, Opzelura could be the first topical therapy specifically indicated for HS.
Meanwhile, Incyte’s bread and butter, Jakafi, enjoyed 7% sales growth compared to the same period last year, hitting $817 million. The FDA recently approved Jakafi XR, the extended-release version of the JAK inhibitor that can be taken once daily rather than the standard twice-daily regimen. The new formulation contributed $10 million to overall Jakafi sales in the second quarter, as the company expects the drug to approach $40 million to $50 million for the full year, according to Meury.
The company is on track to achieve its formulary coverage goal of 50% to 70% by year-end, with recent deals with several major payers, including CVS Health and Optum, the CEO said.
Incyte’s goal is to convert about 10% or 30% of existing patients to the extended-release formulation before Jakafi’s loss of exclusivity between late 2028 and early 2029. With the sales guidance, the company is targeting a conversion rate between 3% and 5%, Mohamed Issa, head of U.S. commercial, said on Tuesday’s call.
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As the Jakafi patent cliff draws near, investors are increasingly focused on Incyte’s pipeline. The company’s next-generation, selective JAK1 inhibitor povorcitinib is under FDA review for HS, as Incyte expects a U.S. approval in the first quarter of 2027. The company attributed a 6% increase in expenses in the second quarter to pre-launch preparations for povorcitinib.
The drug recently turned up some positive data in vitiligo and is on track to report pivotal results for prurigo nodularis this year.
During the quarter, Incyte also nixed a JAK2 inhibitor candidate, called INCB160058, to focus on other JAK2V617F-targeted programs in its pipeline.