Jazz Pharmaceuticals

Jazz's cancer drug Ziihera just delivered practice changing data in stomach cancer, beating the long standing standard of care in a direct comparison. Patients lived longer and went without their cancer progressing for months more than the old treatment. Jazz expects to file with the FDA in the first half of 2026 and launch by late 2026, with peak sales potential of over 2 billion dollars a year.

Jazz now has three separate franchises each generating over a billion dollars a year in rare sleep, rare epilepsy, and rare oncology. Their epilepsy drug Epidiolex officially crossed blockbuster status in 2025, and the company is sitting on more than 2 billion dollars in cash plus over 1 billion dollars in yearly cash from operations. They also paid down 750 million dollars in debt and grew equity value by 2.8 billion dollars last year.

Generic versions of their older sleep drug Xyrem are now widely available, and the 358 million dollars in royalty revenue Jazz collected from authorized generics in 2025 will drop sharply this year. Management expects the entire oxybate franchise to shrink from 2 billion dollars in 2025 to between 1.8 and 1.9 billion dollars in 2026, with their newer drug Xywav only flat to up 5 percent.

Jazz is currently running at a negative 8.35 percent net margin on a trailing basis, weighed down by costs from the Chimerix acquisition and heavy investment in launching new drugs. Revenue growth has also slowed to under 5 percent, so the company really needs the Ziihera launch to land on time and the new cancer drug Modeyso to keep ramping to justify the spending.