Alvotech Guides to the Low End as Q4 Must Deliver

Alvotech expects full-year revenue and adjusted earnings near the lower end of its guidance, the Reykjavik-based biosimilar maker said on its third-quarter earnings call. The verdict puts a heavy burden on a fourth quarter that must generate roughly $327 million in revenue and $102 million in adjusted EBITDA (earnings before interest, taxes, depreciation and amortization).

Third-quarter revenue rose 5% sequentially to $112 million but fell 2% year on year. Adjusted EBITDA of $31 million was up 40% from the preceding quarter and double the year-earlier figure, Chief Financial Officer Linda Jónsdóttir said.

What must the fourth quarter deliver?

Alvotech maintained its full-year targets of $650 million to $700 million in revenue and $180 million to $220 million in adjusted EBITDA. Nine-month revenue stands at $323 million, with adjusted EBITDA at $78 million. Executives said they expect the final quarter of 2026 to be the strongest of the year.

Jónsdóttir said timing factors had pushed expectations toward the lower end of the ranges. Revenue from both product shipments and licensing milestones fluctuates between quarters, she said, with partner orders and delivery schedules shaping product revenue.

Asked whether missed December approvals could threaten guidance, Jónsdóttir said the company would maintain the lower end of the range despite the approvals. She declined to quantify how much fourth-quarter revenue would come from product sales versus milestones.

For the first nine months, revenue fell 23% from a year earlier, which Jónsdóttir attributed to slower production, licensing revenue timing and the prior-year U.S. launch of a biosimilar to Stelara. Nine-month adjusted EBITDA rose 15% to $78 million.

How much has manufacturing recovered?

Facility improvements that began in the second half of 2025 and ran through the first half of 2026 slowed production and constrained supply. The work finished by the end of the second quarter, but the third quarter still reflected an ongoing ramp-up, Jónsdóttir said.

Chief Operating Officer Joseph McClellan said the U.S. Food and Drug Administration approved two changes in October for manufacturing Simlandi, Alvotech's adalimumab biosimilar, at its Iceland facility:

• One permits production of the drug substance for the U.S. market in two manufacturing suites, effectively doubling available capacity.
• The second covers an enhanced process that more than doubles drug substance output per batch.

McClellan said Alvotech has implemented the enhanced process and is supplying product made with it to the U.S. and Europe for the fourth quarter. The supply network is also widening: Lotte Biologics will manufacture drug substance for multiple products in Syracuse, New York, and commercial production with Fujifilm should begin in the second half of 2027.

What hinges on December's FDA decisions?

Three applications share a December FDA decision date, McClellan said: AVT05, a proposed biosimilar to Simponi and Simponi Aria; AVT06, a proposed biosimilar to Eylea 2 mg; and AVT03, a proposed biosimilar to Prolia and Xgeva. The agency reviews each application independently, he noted.

Chief Executive Officer Lisa Graver said Alvotech and partner Teva are preparing a U.S. launch of AVT05, subject to regulatory approval and a favorable outcome on a pending preliminary injunction motion filed by the brand company. Graver said Alvotech was confident in its patent position but could not comment on Teva's precise launch timing.

In Europe, Alvotech and partner Advanz Pharma have established a presence for AVT05 in 13 markets, including the five largest, Graver said.

The pipeline extends further:

• Proposed Entyvio biosimilars covering intravenous and subcutaneous administration, with applications under review in the U.S. and Europe.
• A European application for AVT29, a proposed biosimilar to high-dose Eylea, which executives described as the first known regulatory submission worldwide for such a product.

Graver said Alvotech believes it holds strong positions in patent challenges involving both Entyvio and high-dose Eylea. The company is preparing to compete in the first wave of Entyvio biosimilars, she said, though regulatory and patent outcomes remain pending.

Is the balance sheet a concern?

Cash on hand fell to $61 million at the end of the third quarter from $143 million at its start. Working capital absorbed approximately $116 million during the quarter as the company ramped up manufacturing, Jónsdóttir said, and net interest payments were $37 million.

Jónsdóttir said Alvotech expects to be cash-flow positive in the fourth quarter. Asked whether the company was fully financed until reaching that point, she said that if capital were needed, Alvotech was confident it could secure it.

The company has not issued detailed 2027 guidance. Jónsdóttir said she expects substantial improvement in adjusted EBITDA next year and a stronger product-margin profile, with "healthy deleveraging" in the later part of 2027.

Graver said demand for the established AVT02 and AVT04 franchises remains strong and should continue into 2027, alongside potential contributions from new launches. Alvotech, founded in 2013 by Robert Wessman, develops and manufactures biosimilars — medicines designed to be highly similar to existing biologic drugs — from an integrated platform in Iceland, working with commercial partners in markets including the United States and Europe.