One of the first gene-therapy companies to reach patients, it makes VYJUVEK, a gel applied to open wounds that treats dystrophic epidermolysis bullosa (DEB), a rare disease where skin blisters like butterfly wings. Founded in 2016 by husband-and-wife team Krish and Suma Krishnan, who self-funded its start, the company named itself "Krystal" for the clarity and precision it wanted in gene therapy.
Vyjuvek revenue rose 24% to $119.2M as international launches offset lower U.S. sales, and operating margin widened to 49%.
International expansion is now carrying growth as U.S. sales softened. rose 24% to $119.2 million and widened 8 points to 49%, driven by launches in Germany, France, and Japan and lower manufacturing costs. The company is profitable and self-funding, but the U.S. business is no longer the growth engine it was.
Key takeaways
Vyjuvek net product rose 24% to $119.2 million, as new launches in Germany, France, and Japan more than offset a decline in U.S. sales.
reached 95%, with cost of goods sold falling 10% to $6.5 million, as manufacturing process optimizations continued to lower average unit costs.
widened to 49.0% from 41.0% a year ago, as growth and lower cost of goods sold outpaced a 14% increase in selling, general and administrative expenses.
Section summaries
Management's Discussion and Analysis
VYJUVEK revenue grew 24% YoY to $119.2M in Q2 2026, driven by EU and Japan launches, with 95% gross margin.
⌄
Net product rose 24% to $119.2M, driven by VYJUVEK launches in Germany, France, and Japan, partially offset by lower U.S. sales.
reached 95% in Q2 2026, with declining 10% due to manufacturing process optimizations lowering average unit costs.
rose 43% to $54.8 million, while increased 39% to $1.79.
for the first half of 2026 reached $155.2 million, up 85% from the same period a year ago, and the company ended the quarter with $845.6 million in cash and short-term investments.
Pricing negotiations are ongoing in Germany and France, with potential launches in Italy and Spain expected in the second half of 2026.
What changed
The prior quarter flagged the U.S. trajectory as a watch item; this quarter, management disclosed that international growth was partially offset by lower U.S. sales, confirming a shift in the geographic mix of .
The Prior Approval Supplement for the revised manufacturing process, flagged repeatedly in earlier filings as necessary to scale production, was again absent from this quarter's outlook.
reached 95%, up from 93% a year ago, as the manufacturing process optimizations noted in the FY 2025 annual report continued to reduce unit costs.
What to watch
The trajectory of U.S. Vyjuvek in Q3 2026, to determine whether the decline noted this quarter is a one-time event or a sustained trend.
The outcome of pricing negotiations in Germany and France and any initial contribution from planned launches in Italy and Spain in the second half of 2026.
Any update on the Prior Approval Supplement for the revised manufacturing process, which remains necessary to scale production but has been absent from recent filings.
Clinical data or regulatory updates for KB707, the most advanced pipeline asset, where a 36% objective response rate and FDA feedback on a single Phase 3 trial path were noted in the FY 2025 annual report.
R&D expenses were nearly flat at $14.5M, as increased clinical costs for KB407, KB707, KB801, and KB803 were offset by lower B-VEC regulatory fees and reduced KB304 spending.
SG&A expenses increased 14% to $39.9M, primarily from higher payroll, travel, and selling costs to support global VYJUVEK commercialization.
Cash and short-term investments totaled $845.6M as of June 30, 2026, with of $155.2M for the first half of the year, up 85% .
Pricing negotiations are ongoing in Germany and France, with potential launches in Italy and Spain expected in H2 2026, while additional marketing applications are planned for Switzerland and Australia.
Quantitative and Qualitative Disclosures About Market Risk
The company holds $845.6M in conservative investments and faces foreign-exchange risk from European and Japanese operations, but uses no derivatives for speculation.
⌄
Cash, equivalents, and short-term investments totaled $845.6 million as of June 30, 2026, held mainly in money market funds, commercial paper, corporate bonds, and U.S. government agency securities.
A hypothetical 100-basis-point change in market interest rates would not materially affect the of the investment portfolio due to its conservative nature.
Foreign-exchange risk arises from operations in Europe and Japan, with cash held in Swiss Francs, Euros, Japanese Yen, and British Pounds, and significant rate fluctuations could materially impact results.
The company does not hold or issue derivatives, commodity instruments, or other financial instruments for speculative trading purposes.
Investments are made under a policy that prioritizes principal preservation and income maximization without significantly increasing risk, and the company believes default or illiquidity risk is not significant.
For discussion regarding legal proceedings, please refer to Note 7 of the notes to the consolidated financial statements in the 2025 10-K and Note 7 of the notes to the condensed consolidated financial statements in this Quarterly Report on Form 10-Q for additional information.…
⌄
For discussion regarding legal proceedings, please refer to Note 7 of the notes to the consolidated financial statements in the 2025 10-K and Note 7 of the notes to the condensed consolidated financial statements in this Quarterly Report on Form 10-Q for additional information.
In the ordinary course of business, we have faced, and we may in the future face, various claims brought by third parties or government regulators and, from time to time, make claims or take legal actions to assert our rights, including claims relating to our directors, officers, stockholders, intellectual property rights, employment matters and the safety or efficacy of our products. Any of these claims have subjected and could in the future subject, us to costly litigation and, while we generally believe that we have adequate insurance to cover many different types of liabilities, our insurance carriers may deny coverage, may be inadequately capitalized to pay on valid claims, or our policy limits may be inadequate to fully satisfy any damage awards or settlements. If this were to happen, the payment of any such awards could have a material adverse effect on our consolidated operations, cash flows and financial position. Additionally, any such claims, whether or not successful, could damage our reputation and business.
The Company’s business, reputation, results of operations, financial condition, and stock price can be materially and adversely affected by a number of factors, whether currently known or unknown, including those described in Part I, Item 1A of the 2025 10-K under the heading “R…
⌄
The Company’s business, reputation, results of operations, financial condition, and stock price can be materially and adversely affected by a number of factors, whether currently known or unknown, including those described in Part I, Item 1A of the 2025 10-K under the heading “Risk Factors.” There have been no material changes to the Company’s risk factors since the 2025 10-K was filed with the SEC on February 17, 2026. For information regarding legal proceedings relating to risks previously described, see Note 7 of the notes to the condensed consolidated financial statements in this Quarterly Report on Form10-Q.
30