Q2 2025 Earnings Reports, Part 3

Companies covered: VIR, ETON, HROW, OCUL.

Word Count: 2,751 words, Reading Time: 13 minutes. Not financial advice, do your own due diligence, for entertainment purposes only.

Hello readers, here is the third part of my earnings season recap. I’m going to tackle a couple new names today I haven’t written about before. Earnings season is starting to slow down now but if enough companies that are remaining report newsworthy items I may do a Part 4 otherwise this will be the last part. I’ll put a list of my favorite positions at the bottom of the article as I’m now trying to make that a standard feature for subscribers for ever article going forward.

Subscribers: I have to include the now standard disclaimer that Substack is telling me this post is too long for email so subscribers please load in browser if the bottom is cut off!

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Vir Bio VIR 0.00%↑

Now that the biotech market is more receptive to clinical-stage companies and stocks are starting to go up again on transformational data, I’ve been reevaluating my entire list of clinical-stage companies that I follow. Here is a potentially interesting one.

VIR is at a 52 week low, trading significantly below cash, and has two uncorrelated therapeutic areas in their pipeline and if either is successful it could result in a multi-bagger for the stock price.

The portion of the pipeline that gets the most attention is the dual-masked T-cell engager candidates, which are riding in the excitement that JANX 0.00%↑ has generated with their initial clinical data. To be clear, VIR has generated some limited monotherapy data as well but the patients treated were previously exposed to a variety of prior therapies and the sample size is small so it’s hard to really make a lot of the initial patients, even though responses were seen. But unmasked T-cell engagers are a valid modality, hitting HER2, PSMA, and EGFR are validated targets, they have room to further dose escalate, and the early safety data related to Cytokine Release Syndrome looks promising with no Grade 3 or above CRS.

I know the likelihood of success in oncology with a new modality (in this case, dual masking the T-Cell Engagers) historically is fairly low. But the current valuation is not demanding and essentially you can own the company for “free” for the near future.

Currently, the market capitalization is 594 million. As of June 30, 2025 the company had stockholders’ equity of $947 million. They burn roughly $100 million in cash per quarter, mostly on R&D. (As an aside - that seems like an insanely high number.)

If the stock price stays level, that means they won’t have a “positive” enterprise value until roughly June 30, 2026. I sense the stock price is depressed in part because they haven’t given a timeline for the next wave of oncology data.

But there are multiple ways to win. Even if they don’t release consequential data before summer 2026 (although…they should) investors could still win if JANX releases interesting data as VIR would rise in sympathy as the only other pure play dual-masked TCE in the clinic.

Putting aside oncology, I actually think I like their virology part of the pipeline which is solely focused on developing a new treatment for Hepatitis Delta. Hepatitis Delta virus or HDV is a co-infection with Hepatitis B but it is worth testing for and treating: the mortality rates reach up to 50% in the decade following co-infection. Unfortunately, with no U.S therapy approved on the market, testing rates are low and there is not even a solid number for how many patients have this co-infection in the U.S. It is estimated that there are 61,000 viremic patients in the U.S. and 38,000 in the “EU4” plus U.K. but those numbers may well be an underestimation due to the lack of testing.

Vir’s ECLIPSE 1 study should have data by late 2026 and there is an outside possibility that ECLIPSE 2 will have data in 2026 as well despite starting enrollment four months later, due to the fact it has a shorter endpoint.

As far as comps, bulevirtide (brand name HEPCLUDEX) was acquired by Gilead for approximately $1.4 billion when it was only approved in the E.U. and not the U.S. Now Gilead probably overpaid for the acquisition (as they have in modern times) but Gilead’s commitment to this market might actually end up helping Vir. They are attempting to get approval in the U.S. and have already build a (small) market in the E.U for HDV therapies - Vir’s combination of tobevibart and elebsiran is a far, far better drug than bulevirtide.

There is a real advantage to letting Gilead build a global market and raise awareness of HDV and testing only to come behind them with such a clearly superior agent that they can snatch up all the future patients. HDV patients are also geographically concentrated in major metro areas for the most part and wouldn’t require a huge commercial sales force to sell the drug. If the oncology side turns out to be something then they would have cash flows to help fund those candidates. If the oncology side is nothing, then the current valuation of ~$600 million would only require peak sales of $150 million to $200 million to generate likely return for shareholders. Oh, and the company does have some limited commercialization experience from selling COVID monoclonal antibodies although I’m not sure how relevant that would be in 2027.

I don’t think there is a need to rush into Vir stock especially with no catalysts in 2025 aside from enrollment updates for the Eclipse trials. But as we get closer to data updates from JANX, multiple oncology data updates in 2026 from the company itself, and Hepatitis Delta data likely at the end of 2026 I think it’s an interesting name to keep on the radar. Also, unlike many clinical-stage companies, they do a fairly exhaustive quarterly earnings call which I like for transparency. It’s worth a listen this past quarter if you’re interested in either of these therapeutic focus areas.

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Eton Pharma ETON 0.00%↑

My interest in Eton was piqued when I saw this tweet making the connection between ETON and HROW. I had looked at Eton in the past but had really never felt passionate enough to dive in and start a position. Since the last time I researched the stock, however, the story has gotten significantly better due to some smart acquisitions. The setup is almost exactly the same as Harrow (mentioned below) in that assets are acquired at low cost, brought under a central structure, the commercialization is improved, and cash flows are used to acquire more undervalued assets.