GKOS Q3 2025: Epioxa Approval Sets $78K Rare Disease Pricing, Anchoring 2026 Growth Outlook
GKOS delivered a record quarter and set the stage for a new rare disease revenue stream with FDA approval of Epioxa, the first incision-free corneal cross-linking therapy for keratoconus, priced at $78,500 per administration. Management raised 2025 revenue guidance and issued a preliminary 2026 outlook, signaling confidence in the ramp of both Epioxa and IDOS-TR, despite payer adoption hurdles and a complex corneal franchise transition.
Summary
- Epioxa Launch Resets Corneal Franchise: FDA approval and $78K pricing position GKOS for rare disease expansion.
- IDOS-TR Drives Glaucoma Growth: Broad-based adoption and payer progress underpin segment momentum.
- 2026 Outlook Anchored in Dual Ramps: Early guidance reflects staged Epioxa rollout and ongoing IDOS-TR penetration.
Performance Analysis
GKOS posted record Q3 results, with consolidated net sales growth driven by robust U.S. glaucoma franchise expansion and international gains. IDOS-TR, an intracameral sustained-release glaucoma therapy, emerged as a major growth engine, contributing approximately $40 million in the quarter and benefiting from expanding Medicare coverage across multiple MAC regions. This performance was complemented by steady international glaucoma growth and ongoing execution in the corneal health segment, though Fortrexa volumes reflected the early impact of the planned Epioxa transition.
Gross margin accretion and a debt-free balance sheet provide operational flexibility as the company invests in new launches and patient access initiatives. However, the corneal health franchise faces a near-term decline as Fortrexa is phased out, with management openly flagging a material drop in segment revenue ahead of Epioxa’s commercial availability in 2026. The company’s raised full-year guidance and preliminary 2026 outlook ($600–$620 million) signal confidence in offsetting these headwinds through new product ramps and broader franchise execution.
- Glaucoma Franchise Surge: U.S. segment up 57%, with IDOS-TR driving new category adoption and consistent regional expansion.
- Corneal Health in Transition: Fortrexa volumes declining as patients and providers anticipate Epioxa launch.
- Margin and Cash Strength: Gross margin improved and $278 million cash balance supports pipeline and launch investments.
Underlying execution supports GKOS’s claim to diversified ophthalmic leadership, but the next 12 months will test the company’s ability to manage rare disease launch complexity and payer education at scale.
Executive Commentary
"Epioxa is more than a product. It's a reset moment and new way forward for keratoconus care. We're proud to lead the way once again in forging a new path to drive expanded patient access and enhance treatment standards."
Tom Burns, President and COO
"We are confident, obviously, that we have a best-in-class solution that works well for the patients afflicted with keratoconus. So we look forward to engaging those conversations with the payer community."
Joe Gilliam, CFO
Strategic Positioning
1. Rare Disease Market Entry with Epioxa
Epioxa, a novel incision-free cross-linking therapy, is positioned as a category-defining treatment for keratoconus, a rare, progressive corneal disease. With a $78,500 wholesale acquisition cost, management is targeting a rare disease pricing framework, arguing for value based on single-administration efficacy, improved patient experience, and long-term cost avoidance (e.g., corneal transplants). The strategy includes a comprehensive patient access program, optometric detection campaigns, and a new specialty pharma channel to drive diagnosis and uptake.
2. IDOS-TR Penetration and Payer Access
IDOS-TR, a three-year sustained-release glaucoma implant, continues to see strong adoption, with broad-based growth across established and newer Medicare regions. Management is focused on educating MACs (Medicare Administrative Contractors) and payers to secure consistent professional fee coverage, with the potential for further inflection as remaining regions onboard and LCD (Local Coverage Determination) policies are clarified. The company is also investing in clinical studies to support expanded indications and combination use cases.
3. Corneal Franchise Transition and Pipeline Investment
The transition from Fortrexa to Epioxa represents a strategic reset for the corneal health business. GKOS is discontinuing Fortrexa in favor of Epioxa, aiming to expand the treated population from the current 10,000 patients to as many as 50,000 over time. The company is also building a new R&D and manufacturing facility to support long-term innovation, underlining a commitment to chronic and rare ophthalmic disease leadership.
4. Capital Allocation and Launch Discipline
Management is emphasizing ROI-driven investments, balancing aggressive pipeline spending with operational efficiency. The company is leveraging its cash position to fund patient education, payer engagement, and field force expansion for both Epioxa and IDOS-TR, while maintaining discipline in specialty pharma partnerships and capital equipment deployment for the new therapy.
Key Considerations
GKOS’s quarter was defined by operational outperformance and a bold strategic pivot toward rare disease leadership, but the coming year will require careful management of payer adoption, patient access, and franchise transition risk.
Key Considerations:
- Rare Disease Pricing Leverage: Epioxa’s $78K price point is below many orphan drugs, but payer education and access hurdles will be significant in the first year of launch.
- Payer and Site of Care Ramp: Epioxa revenue contribution in 2026 will be gated by site of care buildout, payer coding (miscellaneous J-code initially), and gradual commercial coverage adoption.
- IDOS-TR Adoption Trajectory: Broad-based regional growth, but further inflection depends on remaining MAC coverage and potential LCD outcomes.
- Corneal Health Volatility: Near-term headwinds as Fortrexa volumes decline ahead of Epioxa, with management openly forecasting a material dip before the new therapy ramps.
- Pipeline and Facility Investment: Over $1 billion invested in R&D to date, with new manufacturing capacity coming online to support future launches and scale.
Risks
The primary risk is execution on Epioxa’s rare disease launch, including payer adoption, coding delays, and the challenge of expanding diagnosis in an under-penetrated market. Glaucoma franchise growth is subject to reimbursement policy shifts and MAC coverage variability, while corneal health faces a near-term revenue trough during the Fortrexa-to-Epioxa transition. Competitive launches and regulatory decisions, particularly around IDOS-TR re-administration, could also impact trajectory.
Forward Outlook
For Q4 2025, GKOS guided to:
- Low double-digit growth in international glaucoma, with competitive launch headwinds in some markets.
- Material year-over-year decline in corneal health, reflecting the transition to Epioxa.
- Mid-40% YoY growth in U.S. glaucoma, with IDOS-TR growth tempered by full cataract surgery schedules and tough comps.
For full-year 2025, management raised guidance to $490–$495 million, and offered a preliminary 2026 range of $600–$620 million.
- 2026 outlook assumes staged Epioxa launch, gradual payer adoption, and continued IDOS-TR ramp.
- Further franchise-level granularity to be provided with Q4 results.
Takeaways
GKOS is executing on a dual-engine growth model, leveraging rare disease pricing and payer education for Epioxa, while driving procedural glaucoma adoption with IDOS-TR.
- Rare Disease Launch Complexity: Epioxa’s success will hinge on payer education, site of care buildout, and patient identification in a fragmented market.
- Glaucoma Franchise as Foundation: IDOS-TR adoption is broad-based, but further payer wins are needed for full market realization.
- 2026 as a Transition Year: Investors should expect a staged rare disease ramp and near-term corneal health volatility before new therapies reach scale.
Conclusion
GKOS delivered on operational momentum and set the stage for a rare disease franchise reset, but the next year will test its ability to execute on payer access and large-scale patient identification. The company’s dual focus on glaucoma and rare disease innovation positions it for multi-year growth, provided it can navigate the inherent complexity of new category launches and franchise transitions.
Industry Read-Through
GKOS’s Epioxa launch signals a new era for rare ophthalmic disease management, with single-administration therapies and rare disease pricing frameworks increasingly shaping go-to-market strategies. The company’s approach to payer education, optometric engagement, and specialty pharma integration offers a template for other device and biotech firms seeking to expand rare disease access. IDOS-TR’s procedural pharmaceutical model also highlights the growing convergence of device and drug modalities in chronic disease management. Broader industry participants should monitor payer response to high-priced, single-use therapies, as well as the operational demands of rare disease franchise transitions and the evolving role of optometry in early diagnosis.