Amphastar Pharmaceuticals, Inc. experienced a robust second quarter in 2026, marked by an increase in net revenues and an expansion of its gross margin. This positive financial performance was predominantly fueled by the successful introduction of new products and sustained strong demand for its established product lines. Despite a dynamic operational landscape, the company highlighted significant achievements, including the successful market entry of Ipratropium Bromide and enhanced sales for other recently launched items such as iron sucrose and teriparatide. Challenges, however, arose from pricing pressures related to 340B rebates and shifting consumer purchasing behaviors, which impacted sales figures for BAQSIMI and Primatene MIST. Operating costs saw an uptick, attributed to increased marketing campaigns, legal expenditures, and necessary remediation efforts at the IMS facility following a critical FDA warning letter. Nonetheless, Amphastar reaffirmed its sales growth projections for the entire year, demonstrating ongoing advancements in its biosimilar and proprietary drug development pipelines.
During the recent earnings call held on Thursday, August 6, 2026, at 5:00 p.m. ET, key executives including Senior Vice President of Corporate Communications Dan Dischner, Executive Vice President of Regulatory Affairs and Clinical Operations Tony Marrs, and Chief Financial Officer William Peters provided detailed insights into the company's performance. The discussion emphasized Amphastar's strategic pillars: enhancing its commercial portfolio, advancing its pipeline of complex generics and biosimilars, and progressing proprietary development programs. These initiatives are designed to foster diversified growth, bolster resilience, and reduce reliance on any single product or market.
Financially, Amphastar reported net revenues of $183.9 million, a 5% increase from the previous year's $174.4 million. The gross margin improved to 50.8% from 49.6%. Noteworthy product performances included $8.4 million from Ipratropium Bromide sales post-April 2026 launch. BAQSIMI sales were $45.5 million, a slight decrease from $46.7 million last year, primarily due to higher rebates and 340B pharmacy discounts, despite a 17% growth in prescription volume. Primatene MIST recorded $21.0 million, an 8% decline influenced by customer purchasing cycles. Glucagon sales saw a 42% decrease to $11.9 million due to increased competition, while other product sales rose 25% to $66.2 million, driven by iron sucrose, teriparatide, and albuterol.
Operating expenses increased across several categories. Selling, distribution, and marketing expenses climbed 30% to $13.3 million, largely due to heightened marketing for BAQSIMI and elevated freight costs. General and administrative expenses also rose 30% to $18.2 million, attributed to legal fees, personnel costs, and the implementation of a new ERP system. Research and development expenditures increased by 10% to $22.2 million, mainly from higher clinical trial expenses for the insulin pipeline. Despite these increases, GAAP Net Income was $30.3 million, or $0.67 per diluted share, compared to $31.0 million, or $0.64 per diluted share, in the prior year. Adjusted Non-GAAP Net Income remained relatively stable at $40.8 million, or $0.91 per diluted share. The company generated $51.3 million in operating cash flow and executed $45.0 million in share repurchases. A significant $100.0 million milestone payment to Eli Lilly is due in Q3 2026 after BAQSIMI exceeded its net sales target.
Regarding the IMS facility, management acknowledged increased expenses of $2 million to $3 million per quarter for remediation efforts following an FDA warning letter. While this may lead to a slight slowing of sales from IMS, which accounts for approximately one-third of corporate revenue, the company does not anticipate a material adverse effect on overall business operations. Capital expenditure is being reallocated to cover these remediation costs without altering the total corporate capital expenditure profile. The commercial launch for insulin aspart biosimilar is still projected for 2027, contingent on regulatory approval, with an anticipated gross margin at or slightly below current corporate levels due to market competition. Business development priorities are focused on assets that can contribute to earnings within a year, although early-stage opportunities in oncology, ophthalmology, and immunology are also being explored.
The company maintains its full-year sales growth guidance of mid-single digit to high single-digit, underscoring the strength of its diversified portfolio and strategic investments. Management expressed confidence in its robust pipeline, U.S.-based manufacturing capabilities, and vertically integrated operations as key drivers for long-term value creation in an evolving pharmaceutical landscape. The proactive approach to addressing regulatory observations and continued investment in research and development underscore Amphastar's commitment to quality and innovation.
