Coherus BioSciences Q1 2025 Earnings: Transition Complete, But the Proof Still Awaits
Taking a Look at Coherus BioSciences (CHRS) Earnings Results.
Coherus BioSciences (CHRS) just reported its Q1 2025 results, marking a pivotal moment in the company’s transformation from a biosimilar player to a pure-play oncology company. This Q marks the end of CHRS’ legacy business and the beginning of its next chapter. Below is a breakdown of the key highlights from Q1, covering the company’s performance (with a focus on Loqtorzi/Udenyca), pipeline updates, financial standing, & my take on the quarter.
Q1 Performance in a Nutshell
This quarter reflected a business in transition. On an adjusted basis (excluding divested products), net revenue was $7.6M, up from $2.3M a year ago, entirely driven by its new cancer therapy Loqtorzi. Meanwhile, its former flagship Udenyca (a Neulasta biosimilar) contributed $31.5M in Q1 sales, but those are now classified as discontinued operations due to the product’s divestiture in April. Key points from the quarter include:
Loqtorzi (toripalimab) – Their PD-1 immunotherapy for nasopharyngeal carcinoma (NPC) generated $7.3M in Q1 net sales. This was Loqtorzi’s first full quarter on the market (the drug launched in late Q4 2024) and showed 15% growth in patient demand compared to Q4 2024. It’s a modest start, but importantly Loqtorzi is the only FDA-approved treatment for NPC across all lines of therapy. An endorsement by the National Comprehensive Cancer Network (NCCN) in late 2024 (Loqtorzi was given Preferred status in NPC treatment guidelines) should help drive adoption going forward.
Udenyca (pegfilgrastim biosimilar) – Once CHRS’ cash cow, Udenyca recorded $31.5M in Q1 sales, albeit under a temporary cloud from a late-2024 supply interruption that dampened early Q1 demand. However, Udenyca’s performance is now more a historical footnote: CHRS completed the sale of the Udenyca franchise in April 2025 for a total deal value of up to $558M (including $483m upfront cash and up to $75M in potential milestones). This sale officially closes the book on their biosimilar business. Udenyca (and the rest of the biosimilar portfolio, including Humira biosimilar Yusimry and Lucentis biosimilar Cimerli) are now out of CHRS’ ongoing operations.
The focus here now is squarely on growing Loqtorzi’s sales in NPC and managing the company’s costs during this ramp-up period (they are pretty much in cost control now). CHRS reported a net loss from continuing ops of $47.4m ($0.41 per share) for the quarter, which, while sizable, was narrower than the loss a year ago. Cost cuts helped, R&D/SG&A expenses both came down YoY as the company streamlined operations and wound down biosimilar-related spending. It’s clear that Q1 was less about top-line growth and more about executing the strategic pivot to a new business model.
Pipeline Progress: CHS-114 & Casdozo
With biosimilars in the rearview, they are now heavily focused on its immuno-oncology pipeline. Management provided some encouraging news on their two key pipeline candidates, CHS-114 and casdozokitug, which are being developed to work in combination with Loqtorzi in future cancer indications:
CHS-114 (anti-CCR8 antibody): CHS-114 is a first-in-class cytolytic antibody targeting CCR8 on regulatory T cells (Tregs). In April, at the AACR 2025 conference, management presented early Phase 1 data showing proof-of-mechanism. Notably, CHS-114, both alone and combined with toripalimab (Loqtorzi) in advanced head and neck cancer patients, achieved a confirmed partial response in a heavily pre-treated, PD-1–refractory patient, along with evidence that it was doing what it’s supposed to do biologically (depleting CCR8+ Tregs by about 50% and boosting CD8+ T cells in tumors). Safety looked manageable and in line with expectations. Off this positive signal, CHRS has already initiated two Phase 1b expansion trials of CHS-114 + Loqtorzi combos: one in second-line head & neck cancer and another in second-line gastric cancer, both starting in Q1. These studies aim to optimize dosing and set the stage for potential Phase 2 trials, with initial readouts expected in 2026. It’s still very early, but CHS-114’s initial data hint that it could enhance the efficacy of PD-1 therapy (like Loqtorzi) by unleashing the immune system more, a strategy that could have broad applications in solid tumors if it pans out.
Casdozokitug (IL-27 antagonist): Casdozokitug (sometimes nicknamed “Casdozo” I like to use) is another novel immunotherapy in their pipeline, a first-in-class IL-27 cytokine antagonist. IL-27 is an immunosuppressive signaling molecule; blocking it may boost anti-tumor immune responses. CHRS is exploring casdozo in difficult cancers like liver and lung cancer, especially in combination with checkpoint inhibitors. In Q1, the company highlighted final data from a Phase 2 trial in first-line hepatocellular carcinoma (HCC), where casdozo was combined with Roche’s Tecentriq (atezolizumab, a PD-L1 inhibitor) and Avastin (bevacizumab). The updated results were quite encouraging: the overall response rate (ORR) improved to 38%, up from an earlier reported 27%, and the complete response rate rose to 17% (versus ~10% previously). The improved numbers suggest that responses deepened over time, a positive sign of durable activity. Importantly, responses were seen in both virus-related and non-viral HCC, and no new safety issues emerged beyond what’s expected from the combo drugs. Following on this success, they have launched a new randomized Phase 2 trial of casdozo + Loqtorzi + bevacizumab in first-line HCC, which is actually enrolling patients now. The first data from this combo study are anticipated in the first half of 2026. Casdozo has shown hints of activity as a monotherapy in heavily pre-treated non-small cell lung cancer (NSCLC) and renal cell carcinoma, which broadens its potential. While there’s a long road ahead, both CHS-114 and casdozo are off to promising starts, and CHRS is wisely leveraging Loqtorzi as a backbone therapy to explore their value in combination. The pipeline assets could open up significant new markets if early efficacy is confirmed in larger trials.
Financial Posture: A Reinforced Balance Sheet & Loqtorzi’s Next Steps
One of the most consequential developments for CHRS this quarter wasn’t a line item on the income statement, but rather a transformation of the balance sheet. With the Udenyca divestiture completed in April, their financial position has dramatically improved (will not show until Q2):
Cash Infusion: The company received $483.4M in cash from the Udenyca sale (this includes payment for inventory). This one transaction is a game-changer for their liquidity. As of March 31, 2025, they had only $82M in cash on hand (down from $126M at year-end 2024, due to ongoing operating losses & pipeline investments). The infusion from the sale landed just after quarter-end, so it will appear on Q2’s balance sheet, effectively quintupling their cash reserves going forward.
Debt Reduction: They used a large chunk of the Udenyca proceeds to eliminate virtually all of its debt. Specifically, the company has repurchased or paid off about $230M of convertible notes (which were due 2026) and also spent roughly $49M to buy out a royalty obligation related to Udenyca. The bottom line is that Coherus emerges from this deal with no significant debt overhang. This is a turnaround from the highly leveraged position the company was in a year ago. In fact, management noted that after the dust settles, they expect to have roughly $250M (actually a little more) in cash on the balance sheet and a cash runway of over two years (funding them through key pipeline milestones in 2025/2026). The removal of debt also takes a lot of pressure off the stock, previously, heavy short-selling was at least partly driven by “convertible arbitrage” (hedge funds shorting the stock against those now-redeemed convertible bonds). With the debt gone and shorts losing that thesis, the capital structure is cleaner and the risk of financing distress is vastly lower.
Ongoing Operations: Now they are sin investment mode with Loqtorzi and the pipeline, so we shouldn’t expect profitability in the immediate term. In Q1, opex for continuing operations were about $5M (R&D plus SG&A), which greatly exceeded the $7.6M in continuing revenue. Losses will likely continue over the next couple of years as the company funds its trials and builds Loqtorzi’s market presence. However, thanks to the recent cash windfall and cost-cutting efforts, they can comfortably support these investments without needing to dilute shareholders or raise additional capital in the near future. Management has also been streamlining the organization (they executed a 30% headcount reduction in late 2024) to reduce burn rate. The expectation is that as Loqtorzi sales ramp up and pipeline programs advance, CHRS has enough cash to bridge to the point where it can achieve breakeven cash flow (management is targeting the 2027/2028 timeframe for break-even, assuming Loqtorzi expands into new indications by then).
So, what’s next for Loqtorzi now that Coherus is “all-in” on this drug? In the near term, the company’s task is to grow Loqtorzi’s sales in NPC. NPC is a rare cancer in the U.S., so expecting rapid adoption is not reasonable, but Loqtorzi has a lock on that niche as the sole approved therapy. According to management, they will be pushing to get oncologists comfortable with this relatively new PD-1 drug and to ensure NPC patients are identified and started on treatment. Encouragingly, on the call, they expressed confidence that Loqtorzi can reach $150M–$200M in annual revenue (just in the NPC indication) over the next three years as awareness and uptake increase. Hitting that kind of run rate will require steep growth from the current ~$7M/quarter, but the combo of strong efficacy in NPC, guideline support, and CHRS’ commercial effort could drive steady gains quarter by quarter.
Beyond NPC, CHRS is strategizing how to unlock broader value from Loqtorzi. They have outlined two prongs to this strategy: (1) combining Loqtorzi with other agents (like CHS-114 and casdozo from their own pipeline, as well as potentially external partners’ drugs) to pursue new indications, and (2) seeking additional label expansions through partnerships. In practice, this means CHRS might collaborate with other biotech/pharma companies to test Loqtorzi in combination with novel cancer therapies (the company indicated such partnerships are being explored in 2025). Potential new indications could include other tumor types where PD-1 inhibitors are effective, for example, they have their eyes on opportunities like small cell lung cancer (where tori has shown positive Phase 3 results in China) and others. Any successful expansion would, of course, take time and clinical data to materialize. But the takeaway is that Loqtorzi is not intended to remain a one-indication drug: CHRS is aiming to turn it into a platform of sorts, much like Keytruda or Opdivo, by layering on new uses through smart combos. With a fortified balance sheet, they now have the resources to support this plan, whether that’s funding trials, getting partnership deals, or simply having the patience to wait for data. Now it’s all about execution: making sure Loqtorzi’s current launch continues to accelerate & that the pipeline delivers on its early promise.
My Take
As an investor who has followed this company through this tumultuous transition, and many years before, my feelings after Q1 2025 are mixed but mostly optimistic. On one hand, CHRS has impressively completed its strategic overhaul: the company is now financially stable (no debt, lots of cash) and fully focused on a coherent mission. This quarter essentially completed the cleanup. Management delivered on what they said they would do, they monetized the biosimilars at a reasonable price and cleaned up the balance sheet. For that, I give them full credit. The overhangs that once threatened them (debt, cash burn, and the distraction of a low-margin biosimilar business) have been dramatically reduced. The “transition” is indeed complete.
On the other hand, the hard work is just beginning. The phrase “the proof still awaits” rings very true: they now need to prove that it can build a successful oncology franchise essentially from scratch. So far, Loqtorzi’s launch has been decent but not spectacular at all, $7M a quarter won’t cut it and sustained quarters like Q1 will not be acceptable in the future. I want to clear the LOQ sales up which looked like they are stalling in Q1 2025, this decline was not due to waning demand/failing to scale, in fact, underlying patient demand actually increased by more than 15% QoQ. The revenue softness was driven by a seasonal inventory drawdown: in late Q4, distributors and wholesalers had built up Loqtorzi inventory, which was then worked down in Q1, temporarily masking true prescription growth. As a result, revenue didn’t fully reflect the increase in prescriptions and new patient starts seen during the quarter. CHRS expects this to normalize in Q2 as inventory levels align with real-time demand, at which point net sales should more accurately mirror the drug’s uptake trajectory.
That said though, the company must significantly accelerate that figure in the coming quarters. I’m encouraged by the NPC guideline endorsement and management’s confidence in the uptake curve, but until we see QoQ sales trending into, say, the tens of millions, there will understandably be doubt. Likewise, the pipeline updates, while encouraging, are early-stage. CHS-114 and casdozo have intriguing data points, but many a promising Phase 1 has failed to translate into Phase 3 success. I mean, they have a lot to prove in clinical development to show that its pipeline bets will pay off in new indications for Loqtorzi or entirely new products. The first meaningful readouts from those programs won’t come until 2026, so there’s a long horizon here.
From an investor’s perspective, CHRS at this point is a high-risk, high-reward proposition that requires patience. The stock’s valuation is extremely low by any standard, the market is basically pricing in a scenario where Loqtorzi flops and the pipeline goes nowhere at all (pipeline has a price tag of $0). I think that pessimism is overdone given what we know now: Loqtorzi works (it’s an approved, efficacious drug fulfilling an unmet need), and the company is no longer on precarious financial footing. In my view, CHRS today has a solid chance to execute a turnaround and eventually earn a valuation that’s several times higher if everything goes reasonably well. The margin of safety is complimented by that $250M cash buffer, which should protect the company (and by extension, shareholders) from worst-case scenarios in the near term.
However, I also recognize that the next few quarters may not be smooth. We could see relatively low sales numbers and continued losses as the company spends on marketing & R&D, and that might test investors’ patience even further (like Q1). The stock could remain in the doldrums until there’s tangible proof of a sales inflection or clinical win. In other words, while I view the long-term intrinsic value as significantly higher, CHRS is now in a pickle where they need to earn back the market’s trust step by step (which I believe is somewhat warranted). The management team’s execution from here is crucial, not much margin for error now. They’ve made good strategic moves, but now they need to deliver operationally: grow Loqtorzi, hit their milestones, and communicate progress clearly. I believe the turnaround play is still valid here (and M&A opportunity) but they need to execute here on out.