BMRN — Q2 2026 Financial Report Analysis

BioMarin's second quarter of 2026 was the first one to include Amicus Therapeutics, the $5.3 billion rare-disease acquisition it closed on April 27. That deal explains both halves of the headline. Total revenue rose 19.9% to $989.7 million, largely because two acquired drugs, GALAFOLD (for Fabry disease) and POMBILITI + OPFOLDA (for Pompe disease), added $136.0 million in their first nine weeks. But GAAP net income — profit under standard accounting rules — fell 81% to $44.8 million, and diluted earnings per share dropped from $1.23 to $0.23, because the same deal brought integration charges, new amortization and about $2.8 billion of new loans. Excluding the acquired drugs, the base business grew product sales 4.4%.

At a glance

• $989.7 million revenue, +19.9%. Most of the jump is bought, not grown: without GALAFOLD and POMBILITI + OPFOLDA, net product revenue was $848.4 million, up 4.4% on $813.0 million.
• VOXZOGO $252.5 million, +14.0%. BioMarin's growth drug for achondroplasia (the most common form of dwarfism) added new patients in every region, and management raised its full-year VOXZOGO forecast to $1.0–1.05 billion.
• Operating margin 11.2%, down from 33.5%. Operating margin is the share of revenue left after running the business, before interest and tax. Acquisition costs, a $68.7 million jump in amortization and a $143.1 million jump in general and administrative costs did most of the damage.

Results at a glance

Gross margin is the share of sales left after the cost of making the drugs. "Non-GAAP" figures are the company's own adjusted numbers, which strip out items such as stock-based pay, amortization and deal costs; they are useful for seeing the underlying business but are not standardized.

Product by product

Two patterns stand out. First, BioMarin's growth now rests on three products: VOXZOGO, PALYNZIQ and the acquired Amicus drugs. Together VOXZOGO and PALYNZIQ added $60.4 million year over year, while VIMIZIM, ALDURAZYME and KUVAN together lost $36.6 million. Second, the two biggest declines are about order timing rather than lost patients: the 10-Q attributes VIMIZIM's drop to the timing of large government orders and ALDURAZYME's to the timing of shipments to Sanofi, and the company warns this lumpiness "will continue." The six-month figures back that up: VIMIZIM was flat for the half ($404.6 million vs $403.8 million).

VOXZOGO's growth rate slowed in the first half overall (+8.6% for six months vs +14.0% in Q2), so the second quarter was the stronger one. The press release says the number of children treated grew more than 20% year over year and that the U.S. made up about 25% of VOXZOGO revenue, with most new U.S. starts under two years old.

Currency helped a little: a weaker dollar against the euro added $6.6 million to Q2 product sales, versus a $7.1 million drag a year ago, a $13.7 million swing. That is roughly 1.7 points of the 21.1% product-revenue growth.

Where the profit went

The fall from $276.9 million of operating income to $110.9 million comes almost entirely from four lines, three of them tied to Amicus:

Below the operating line, financing costs added a further hit: interest expense rose to $63.3 million from $2.7 million, and interest income fell to $10.5 million from $18.8 million because BioMarin sold its investments to help pay for the deal. That is a $68.9 million swing in net interest in one quarter. Total debt rose from about $1.5 billion at March 31 to about $4.3 billion at June 30, and cash and investments fell from $2.05 billion at year-end to $874.0 million. Management estimates the acquisition debt costs about $200 million a year in interest at current rates.

What the headline numbers hide

• The GAAP-vs-adjusted gap is $191 million this quarter, and most of it is deal-related. Non-GAAP income was $236 million against GAAP net income of $45 million. The adjustments: $84 million of acquisition costs (severance, transaction and integration), $73 million of intangible amortization, $76 million of stock-based compensation (including about $13 million tied to unvested Amicus options), $12 million of inventory step-up and $3 million of other severance, less a $57 million tax effect. The step-up is an accounting artifact: acquired inventory is recorded at close to selling price, so when it is sold the profit on it looks thin. BioMarin recorded about $228 million of step-up, so this drag on gross margin will continue for several more quarters until that inventory is used up.
• Even the adjusted numbers went backwards. Non-GAAP EPS fell 17% to $1.20 and non-GAAP operating margin fell from 39.9% to 36.4%. The company attributes this to higher interest expense, more sales and marketing spending for the acquired products and VOXZOGO's global rollout, and BMN 401 R&D. Interest expense is not excluded from non-GAAP results, so the debt cost shows up in both measures.
• The acquired business was loss-making on BioMarin's books in its first two months. The 10-Q reports Amicus contributed $136.0 million of revenue but a $91.9 million net loss from April 27 to June 30, after deal-related charges and amortization.
• Some R&D spending is now wasted. Late-stage clinical spending rose to $50.3 million from $13.1 million, mostly on BMN 401, which missed one of its two main goals in the ENERGY 3 trial; BioMarin discontinued the program in August. That spending should fall away in later quarters.
• Cash conversion is good. First-half operating cash flow was $388.8 million, 2.6 times the $150.3 million of net income, helped by non-cash charges (amortization and stock pay) and, per the 10-Q, the timing of customer payments and lower inventory purchases.
• Receivables and inventory look clean once the deal is removed. Accounts receivable rose to $1,061.0 million from $908.2 million at year-end, but $123.9 million came with Amicus; inventory rose to $1,782.5 million from $1,298.9 million, of which $469.7 million was acquired. The underlying increases are small.
• The EPS decline is not cushioned by buybacks. Diluted shares were 194.5 million vs 197.1 million a year ago, but the drop mainly reflects convertible-note shares being excluded this year because they would have raised EPS. The tax rate actually rose, to about 27% of pre-tax income from about 19%.
• A one-off from the first quarter weighs on the half-year. Six-month gross margin was 77.3% (vs 80.8%) partly because of a $31.0 million Q1 charge for a failed attempt to expand NAGLAZYME manufacturing.

Takeaway: The Amicus deal turned BioMarin from a debt-light company growing about 4% into a more leveraged one with two new growth drugs, and Q2 shows the full cost of that switch before any of the promised savings. The test for the next year is whether the roughly $220 million of non-GAAP cost cuts arrive on schedule and VOXZOGO keeps growing in the mid-teens, because $200 million a year of interest leaves less room for a slip in either.

Guidance and outlook

On August 6, BioMarin raised its 2026 guidance:

These numbers imply a much bigger second half. After $1,755.9 million of revenue in the first half, the guidance needs $2,119–2,169 million in the second half, more than $1.05 billion a quarter, as GALAFOLD and POMBILITI contribute for full quarters. For VOXZOGO the range implies $528–578 million in the second half, or about $264–289 million a quarter against $252.5 million in Q2. The non-GAAP EPS range implies $2.94–3.14 in the second half against $1.96 in the first.

One update since this filing: on October 6, 2026, BioMarin said in an 8-K that its acquisition of Alesta Therapeutics, completed August 31, will add about $283 million of acquired in-process R&D expense to third-quarter results, and about $320 million of total pre-tax charges for 2026. BioMarin estimates the hit at about $1.50 to Q3 diluted EPS and about $1.55 to full-year diluted EPS, on both a GAAP and non-GAAP basis. The August guidance did not include this, and the company plans to issue updated guidance with its Q3 results. Read literally, the $4.90–5.10 non-GAAP EPS range would come down to around $3.35–3.55 from this charge alone, though revenue guidance is not affected.

Other dates to watch: an FDA decision on full approval of VOXZOGO in achondroplasia is due by February 28, 2027, and BioMarin submitted VOXZOGO for hypochondroplasia (a related, milder growth condition) in July after its Phase 3 study met its main goal. A second indication would widen the patient pool for the company's main growth drug from 2027.

Our read: the underlying business is healthy but not fast-growing. PALYNZIQ's 27.7% growth and VOXZOGO's 14.0% are offsetting declines in older products. Organic product growth of 4.4% this quarter had a currency tailwind of about 1.7 points, but order timing at VIMIZIM and ALDURAZYME pulled the other way, so the underlying pace is roughly mid-single digits. The investment case now hinges on execution: integrating Amicus, delivering the cost savings, paying debt down toward the company's target of gross leverage below 2.5 times by mid-2027, and keeping VOXZOGO ahead of competing long-acting treatments — BioMarin's own weekly candidate, BMN 333, is in a Phase 2/3 study with data expected in 2027. Expect GAAP earnings to stay depressed through 2026 by amortization, step-up and, in Q3, the Alesta charge; the non-GAAP margin trend is the better gauge of whether the combination is working.