As I posted in my monthly update, I took a starter position in Rigel Pharmaceuticals in October. Yesterday they posted pretty great results and are up ~30%:
- Product revenue up 65% YoY. This is down from 75% last quarter but still impressive
- Net Income up 125% YoY
- 93% Gross Margin
- Raised FY guide from $275M to $287.5 at the midpoint
- All 3 product lines grew at +50%
I’ll be finding the cash during earnings season to add to this position, to at least 5% and perhaps 10%.
I’m still learning about this company, but they are also involved in multiple collaborations with other drug manufacturers which can produce bumps in earnings and regular royalties from those eventual drug sales. This can lead their numbers to look lumpy on the face of it, so I’m mainly keeping an eye on product sales.
Here’s an overview from Gemini on the company:
Rigel Pharmaceuticals: A Simple Overview
Rigel Pharmaceuticals is a biotechnology company that focuses on discovering, developing, and selling specialized oral medicines for patients with rare blood disorders and certain types of cancer. Instead of developing mass-market drugs, Rigel focuses on niche, high-need diseases where few good treatment options exist.
The company’s commercial portfolio includes key products:
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TAVALISSE (fostamatinib): An oral treatment for adult patients with Chronic Immune Thrombocytopenia (ITP), a rare bleeding disorder.
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GAVRETO (pralsetinib): A treatment for specific forms of advanced non-small cell lung cancer and thyroid cancer. Rigel holds the U.S. rights to this product.
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REZLIDHIA (olutasidenib): A drug for adult patients with relapsed or refractory Acute Myeloid Leukemia (AML) who have a specific gene mutation (IDH1).
Different Revenue Streams
Rigel’s revenue primarily comes from two main sources:
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Net Product Sales: This is the money generated directly from selling their commercial drugs, primarily TAVALISSE, GAVRETO, and REZLIDHIA, in the U.S. and from sales to their partners for international distribution. This is their largest and fastest-growing revenue stream.
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Contract Revenues from Collaborations: This includes payments from partners who license their drugs for distribution in other countries, as well as royalties on those sales, and payments related to drug development agreements with other companies like Grifols and Kissei.
For the full year 2025, the company recently projected its total revenue to be approximately $285 million to $290 million, with net product sales making up the majority of this total (around $225 million to $230 million) (Source: Rigel Reports Third Quarter 2025 Financial Results and Provides Business Update).
Market Size (TAM) and Growth Prospects
Total Addressable Market (TAM)
The Total Addressable Market (TAM) for Rigel’s products is primarily defined by the number of patients living with the specific, rare conditions their drugs treat. While these are niche markets, the need for effective treatment allows for premium pricing.
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ITP (TAVALISSE): The market is for a relatively small, chronic patient population. As a later-line treatment, its market is specific, but it is the only approved oral drug in its class.
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Oncology Products (GAVRETO and REZLIDHIA): These drugs target specific genetic mutations in cancer, creating small but well-defined patient populations with high unmet needs. Acquiring U.S. rights to GAVRETO, for example, expanded Rigel’s market into solid tumor oncology (Source: Rigel Pharmaceuticals Acquires U.S. Rights to GAVRETO).
Future Prospects for Growth
Rigel’s growth strategy and future prospects rely on three main factors:
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Product Portfolio Expansion: The company is actively executing a strategy to increase its commercial product sales through strong performance and by adding new drugs via in-licensing or acquisition, as seen with GAVRETO (Source: Earnings call transcript: Rigel Pharmaceuticals Q3 2025 revenue rises, stock dips).
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International Growth: Sales are growing through existing partnerships, for example, the recent launch of TAVALISSE in South Korea (Source: Rigel Reports Third Quarter 2025 Financial Results and Provides Business Update). Expanding into new territories contributes to future revenue.
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Pipeline Development: They are investing in their internal R&D pipeline, with drug candidates like R289 for patients with lower-risk Myelodysplastic Syndromes (MDS). Success in clinical trials for these new therapies would open up entirely new markets and drive future growth. The company reported a significant increase in net product sales and has raised its 2025 revenue guidance, illustrating current strong momentum (Source: Rigel Reports Third Quarter 2025 Financial Results and Provides Business Update).