Madrigal Pharmaceuticals (MDGL -0.24%), a biopharmaceutical firm focused on liver diseases, reported its second quarter 2025 earnings on August 5, 2025. The standout news in this release was an explosive surge in GAAP revenue to $212.8 million, sharply exceeding the consensus estimate of $162.03 million. This outperformance was driven by strong demand for Rezdiffra, the company’s leading MASH therapy, and rapid patient uptake since its April 2024 launch. Operating expenses also grew markedly, reflecting the company’s intensive investment in commercial rollout and research. Overall, the quarter showcased rapid commercial momentum, substantial market adoption, and strategic execution.
| Metric | Q2 2025 | Q2 2025 Estimate | Q2 2024 | Y/Y Change |
|---|---|---|---|---|
| EPS (GAAP) | N/A | ($3.55) | N/A | N/A |
| Revenue (GAAP) | $212.8 million | $162.03 million | $14.6 million | 1,3575% |
| Operating Expenses | $260.0 million | $177.2 million | 46.8% | |
| R&D Expense | $54.1 million | $71.1 million | (23.9%) | |
| SG&A Expense | $196.9 million | $105.4 million | N/A |
Source: Analyst estimates for the quarter provided by FactSet.
About Madrigal Pharmaceuticals and Its Focus Areas
Madrigal Pharmaceuticals develops treatments for serious liver diseases, most notably metabolic dysfunction-associated steatohepatitis (MASH), a type of progressive fatty liver disease. Its business centers around its lead product, Rezdiffra (resmetirom), which became the first and only therapy approved for MASH by the U.S. Food and Drug Administration (FDA) in March 2024. The recent period was defined by scaling up commercial operations, expanding into additional patient groups, building out international strategy, and protecting its competitive edge in a rapidly evolving market for MASH treatments.
The company’s key to success now lies in four critical areas: rapidly commercializing Rezdiffra in the U.S, advancing efforts to expand Rezdiffra’s indication to new patient populations, growing access outside the United States, and reinforcing its financial and competitive position amid a crowded drug development pipeline. Win regulatory approvals for broader use, and balance investment with ongoing losses will shape its future progress.
Quarter Highlights: Surge in Rezdiffra Sales, Patient Uptake, and Investment
Rezdiffra, a once-daily oral therapy for MASH, was the central driver this quarter. By June 30, 2025, more than 23,000 patients were on Rezdiffra, a jump from more than 17,000 as of March 31, 2025 and from 11,800 at the end of Q4 2024, just six months earlier. For perspective, Madrigal targets a U.S. specialist-treated patient population of approximately 315,000, so this quick pace marks substantial early adoption. Management compared Rezdiffra’s launch favorably to the most successful specialty drug launches of the last decade.
Penetration among medical prescribers is also building: among Madrigal’s top 6,000 specialist targets, roughly 70% had prescribed Rezdiffra by the end of Q1 2025. Within the wider pool of 14,000 target prescribers, about half had prescribed the drug by the end of Q1 2025.
These commercial achievements come with sharply increased costs. Operating expenses were $260.0 million, up 46.8% compared to the prior year quarter (GAAP). The main driver was Selling, General and Administrative (SG&A) expenditure, which increased to $196.9 million. This reflects rapid expansion of sales, marketing, support staff, and investments to build out U.S. and European commercial capabilities. Research and development (R&D) spending decreased compared to the prior year period, however, to $54.1 million, in part due to lower clinical trial activity after Rezdiffra’s approval.
Gross-to-net (GTN) metrics, which account for factors like insurance discounts and rebates, saw some favorable dynamics but are expected to become less favorable over time as payer contracting becomes more common. Management indicated that GTN will “step up throughout 2025” as coverage broadens and contracting increases -- a typical trend for new specialty medicines but a factor that may gradually curb headline sales growth.
On the clinical front, Madrigal continued to invest in expanding Rezdiffra’s reach. The MAESTRO-NASH OUTCOMES study is underway to test the therapy in patients with compensated MASH cirrhosis (a more advanced liver scarring stage known as F4c). Recent open-label results from a two-year treatment period in the Phase 3 MAESTRO-NAFLD-1 trial showed a mean 6.7 kilopascal reduction in liver stiffness, a meaningful improvement which, if replicated in final results, could support U.S. approval for this additional population. Management estimates that F4c patients add another 245,000 potential U.S. candidates for the drug, representing currently diagnosed patients under the care of a liver specialist, nearly doubling the size of its core market if approved.
Meanwhile, European expansion is progressing. The company recently received a positive opinion from the EU’s Committee for Medicinal Products for Human Use (CHMP) recommending Rezdiffra’s approval. A European Commission decision is expected in August 2025, with plans to launch in Germany pending approval. The product is already included in regional clinical practice guidelines. Madrigal added Dan Brennan, a former Boston Scientific executive, to its board.
In terms of pipeline additions, Madrigal licensed the global rights to SYH2086, an experimental oral glucagon-like peptide-1 (GLP‑1) receptor agonist drug from CSPC Pharma, aiming to boost its combination product strategies in MASH. Patent protection for Rezdiffra in the U.S. was also recently extended to February 4, 2045, offering the company a long runway of exclusivity. The competitive threat is significant, with more than 150 MASH drug candidates in development, many featuring GLP-1 pathways. Notably, around 25% of Rezdiffra patients currently use GLP-1 therapies in tandem, while half have used them previously -- a sign that the two approaches are not seen as immediate substitutes so far.
Madrigal’s cash, cash equivalents, restricted cash, and marketable securities balance stood at $802.0 million as of June 30, 2025, down from $931.3 million as of December 31, 2024. However, the company secured up to $500 million in new senior secured credit from Blue Owl Capital during July (including an initial $350 million draw). This strengthens funding for continued commercialization, research, and strategic initiatives. R&D expenses are trending down as clinical trial spend eases, but the company is clear that elevated SG&A investment will persist, especially as the European launch approaches. MDGL does not currently pay a dividend.
Looking Ahead: Guidance and Strategic Watch Points
Madrigal management did not offer precise guidance for future sales, earnings, or profit margin targets. Noting that Wall Street consensus estimates may rise after the latest performance. SG&A spending will remain elevated as commercial investments continue, particularly with the planned launch in Europe in the second half of 2025. Research and development costs are expected to hold steady compared to last year.
Looking forward, investors will want to observe trends in patient adoption and prescriber penetration for Rezdiffra, the evolution of gross-to-net discounts as payer contracting expands, and pipeline progress, especially the pivotal MASH cirrhosis trial due with data in 2027. Competitive activity remains crucial as well, especially as new GLP-1 and other MASH therapies near approval. With expanding access to funding and fresh product pipeline moves, the company seeks to secure lasting growth and leadership in the evolving MASH market.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
