Kamada (KMDA) Q3 2026 earnings review
Kamada raises its 2026 outlook as U.S. drug margins rebound
Kamada, an Israeli maker of specialty plasma medicines, reversed a year-long slide in its gross margin as high-margin U.S. drug sales outpaced lower-margin distribution revenue. Third-quarter sales grew 11% to $52 million while net profit rose 51% to $8 million, helped by strong U.S. demand for its KEDRAB anti-rabies treatment. Chief executive Amir London raised the full-year outlook and declared another dividend, though by our math the updated plan implies EBITDA margin excluding one-offs drops from 29% in the third quarter to 22% in the fourth.
| Revenue | $52.0M +11% from a year ago (+13% before a Q2 return adjustment) |
|---|---|
| Gross margin | 44.8% +2.8 percentage points from a year ago |
| Net profit | $8.0M +51% from a year ago |
| Full-year 2026 revenue outlook | Raised $4M middle of the range: $206.5M (+14% growth) |
⚖️ Verdict: 🟢 Bullish
The story got better because the company's proprietary plasma drugs expanded their gross margin to 50%, easing concerns that last year's GLASSIA royalty cut had permanently weakened the core business.Kamada also launched two more biosimilars in Israel, lifted its 2030 biosimilar sales target to $20–25 million, and raised its 2026 revenue and profit targets. One caution: the company still has not closed an acquisition despite years of looking, and a former distributor raised its arbitration counterclaim to $15.5 million.
The question now is whether the company can keep profit margins near third-quarter levels as lower-margin plasma and distribution sales ramp up in 2027. Either expanding U.S. KEDRAB sales keep consolidated margins high, or the new $50 million plasma supply contract and lapsing research cost savings pull margins back down. Detailed 2027 targets in January and fourth-quarter gross margin will settle it.
🐂 Bull Case
Proprietary Plasma Drugs Reversed the Gross Margin Slide
Kamada makes specialty plasma-derived drugs for rare conditions and distributes third-party medicines in Israel. Gross margin had fallen from a year earlier in four of the previous five quarters because lower-margin distribution sales grew fast and royalties on GLASSIA, a lung disease drug licensed to Takeda, dropped from 12% to 6% in August 2025.
In the third quarter, consolidated gross margin rose 2.8 percentage points from a year ago to 44.8%, cutting the cost of making and buying products from 58.0% of revenue to 55.2%. The company attributed the gain "due to improved product and markets sales mix" as U.S. sales rose 18.6% to $28.2 million. "The underlying demand for our products, especially KEDRAB ® in the U.S. market, as well as VARIZIG ® and HEPAGAM ® , continues to expand," chief executive Amir London said. The drugmaker also confirmed it has enough capacity to meet higher U.S. demand for KEDRAB, its anti-rabies treatment, "in response to a Health Advisory published by the U.S. Centers for Disease Control and Prevention (CDC)".
- Proprietary Products gross margin: 49.9%, up 2.8 percentage points from a year ago by our math
- Clean Proprietary Products revenue growth: 14.2% by our math, before a $0.9 million accounting reversal for second-quarter returns
- Research and development costs: 4.5% of revenue, down 1.1 percentage points after ending an inhaled lung drug trial
What to watch: Proprietary Products gross margin in the fourth quarter. A reading near 50% would show that high-margin U.S. drug sales can offset the August 2025 GLASSIA royalty cut on a full-year basis.
Raised Outlook and Higher Biosimilar Sales Target
Kamada distributes third-party medicines in Israel, including biosimilars, which are lower-cost versions of complex biologic drugs, and collects human plasma in Texas. In October, the Israeli biopharma group launched two new biosimilars in Israel, bringing its marketed lineup to four products, and raised its 2030 annual biosimilar sales target to $20–25 million from $15–20 million.
The company also raised its full-year 2026 revenue outlook by $4 million at the middle of the range to $205–208 million and projected double-digit growth in revenue and profit for 2027. London said the Texas plasma centers are ramping up "in support of our new three-year, approximately $50 million supply agreement" for normal source plasma, which is plasma used to make standard therapies.
What to watch: Detailed 2027 revenue and profit targets in January 2027. Those ranges will show how much the new plasma contract and at least two more biosimilar launches add to next year's growth.
Cash Generation Funded $32 Million in 2026 Dividends
Earlier in 2026, Kamada adopted a policy to pay out at least half of its annual net profit as cash dividends. In the third quarter, the board declared a dividend of $0.14 per share, or about $8.0 million, payable in December, following $24.2 million paid in April and September.
Together, the three payouts total $32.2 million for 2026, which equals 151% of the $21.4 million in net profit earned during the first nine months by our math. Strong cash collection funded the payouts without draining reserves: nine-month operating cash flow more than doubled from a year ago to $37.6 million, leaving $75.3 million in cash at quarter-end.
What to watch: Dividend declarations in early 2027. After paying out 1.5 times nine-month net profit across three distributions in 2026, next year's declarations will show whether payouts return to the 50% policy floor.
🐻 Bear Case
Fourth-Quarter Plan Points to a Margin Drop
London highlighted that third-quarter EBITDA excluding one-offs (earnings before interest, taxes, depreciation and amortization) reached $15.2 million, or 29.2% of revenue, up from 24.9% a year ago. He raised the full-year outlook to $52–54 million on $205–208 million of revenue and projected double-digit growth in both revenue and profit in 2027.
Subtracting the first nine months from the middle of the new full-year outlook leaves $54.3 million of revenue and $12.1 million of EBITDA excluding one-offs for the fourth quarter by our math. That implies fourth-quarter revenue grows 21.6% from a year ago, but the EBITDA margin drops 7.0 percentage points from the third quarter to 22.2%.
This step-down matters because initial commercial sales under the $50 million Texas plasma contract and the two new Israeli biosimilars begin in the fourth quarter, and both carry much lower margins than proprietary drugs. In addition, the company will finish lapping the research and development savings from its cancelled lung drug trial in early 2027, removing a 1.1-point operating margin tailwind.
What to watch: Fourth-quarter gross margin and EBITDA margin excluding one-offs when full-year results arrive. If EBITDA margin falls to the 22% level implied by the outlook, either the outlook is cautious or the new plasma and distribution streams dilute profit margins.
Cash Returns Outpace Deal Execution and Legal Claims
Acquiring commercial-stage drugs is one of Kamada's four stated growth pillars, and London reiterated that the company remains committed to business development and acquisitions. Yet another quarter passed without a deal after earlier targets for 2025 and early 2026 slipped, while the company committed $32.2 million to 2026 dividends and paid a $3.0 million sales milestone to Saol Therapeutics.
Meanwhile, a legal dispute with a former distributor for Russia and Ukraine escalated in October 2026. After the drugmaker sought $2.2 million in unpaid bills in arbitration, the distributor raised its counterclaim from $6.7 million to $15.5 million ahead of a December 2026 final hearing, though Kamada said the claim "has weak merits".
What to watch: The arbitration outcome following the mid-December 2026 hearing and any acquisition announcement. Paying out $32.2 million in dividends leaves less cash on hand if a deal or legal liability arises.
Risks this quarter didn't answer
Four standing operational and governance risks received no new numbers or resolution in the third-quarter materials.
- Reliance on Kedrion for KEDRAB: U.S. demand grew, but the partner still accounts for roughly 30% of company revenue; annual product sales in the 2026 full-year report will give the next reading.
- Chief financial officer transition: Chaime Orlev's planned departure was announced in August, and the release named no successor ahead of year-end.
- CYTOGAM transplant drug recovery: following a drop to $17 million in 2025 from $23 million in 2024, the company started the SHIELD kidney transplant study, but only annual product disclosures will show if sales stabilized.
- Middle East shipping and manufacturing: no shipment delays hit the third quarter after a first-quarter delay, though manufacturing remains concentrated in Israel.
💲 Other KPIs
Uncollected customer bills fell 13.0% from a year ago to $27.3 million even as revenue grew 10.7%. Collecting $9.4 million of receivables during the third quarter drove operating cash flow up 90.7% to $19.9 million, reversing the working-capital buildup from the first half of the year.
Stockpiled raw plasma and finished drugs rose 8.5% from a year ago and increased by $5.8 million during the third quarter alone. The biopharma group is building inventory to supply U.S. KEDRAB demand, two new Israeli biosimilars, and fourth-quarter plasma shipments.
Overhead costs rose 21.2% from a year ago, climbing from 10.3% of revenue to 11.2% by our math. Non-cash share-based compensation drove most of the increase, rising to $0.9 million in the quarter from $0.1 million a year earlier.
🔮 Guidance
Raised. The middle of the range moved up $4.0 million to $206.5 million, or 14.4% growth for the year by our math, after holding steady for three quarters. Subtracting nine-month revenue of $152.2 million leaves $54.3 million for the fourth quarter by our math, up 21.6% from a year ago as initial Texas plasma shipments begin.
Raised. The middle of the range rose $1.5 million to $53.0 million, or 26.2% annual growth by our math, repeating Kamada's mid-year raises in 2024 and 2025. By our math, that leaves $12.1 million for the fourth quarter — up 54.4% against a weak fourth quarter of 2025, but down from $15.2 million in the third quarter.
Unchanged on revenue and expanded to include profitability. Management projects at least 10% growth in both revenue and profit next year, with detailed dollar ranges arriving in January 2027. The full-year ramp of the $50 million plasma supply contract and at least two more biosimilar launches in Israel support the top-line target.
❓ Key Questions
Why does the fourth-quarter plan imply lower margins?
By our math, the raised full-year outlook implies fourth-quarter revenue rises to $54.3 million while EBITDA excluding one-offs drops from $15.2 million in the third quarter to $12.1 million. Is that drop driven by low-margin plasma and distribution mix or management caution?
What caused the $935,000 return reversal in Israel?
Footnote 4c discloses a $935,000 non-cash revenue reversal in the third quarter for estimated product returns from second-quarter sales, turning Israeli proprietary revenue negative (-$332,000). Which product was returned, and are further adjustments likely?
When will Kamada name a new finance chief?
Kamada announced the departure of nine-year finance chief Chaime Orlev in August 2026 with transitional support through year-end, but the third-quarter release named no successor. How does the vacancy affect the search for acquisitions?
What are current biosimilar sales after October's launches?
Kamada launched two more biosimilars in October 2026, bringing its Israeli portfolio to four products, and lifted its 2030 annual sales target to $20–25 million. What is the 2026 revenue run-rate for the four marketed biosimilars?