MDGL Stock Down Despite Q2 Beat, MASH Drug Drives Top-Line Y/Y Growth

However, Madrigal shares fell 9.8% on Thursday despite the better-than-expected quarterly results, likely reflecting investor concerns that Rezdiffra's commercial growth is transitioning from its rapid launch phase to a more sustainable pace.

MDGL’s Q2 Results in Detail

In March 2024, the FDA granted accelerated approval to Rezdiffra, making it the first and currently the only approved therapy for the MASH indication. The eligible patient population includes adults with noncirrhotic MASH with moderate to advanced liver fibrosis. Rezdiffra has also received conditional approval as the first and only therapy in the EU to treat adults with noncirrhotic MASH with moderate-to-advanced liver fibrosis. Per Madrigal, more than 49,000patients are receiving the treatment as of June 30, 2026, up 2 times from second-quarter 2025, reflecting continued strong physician adoption and high patient demand.

During the quarter, research and development expenses increased 69% to $91.2 million in the second quarter of 2026. The increase can be primarily attributed to one-time, upfront business development expenses of $25 million.

Year to date, Madrigal shares have lost 15.4% compared with the industry’s 2.5% decline.

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Selling, general and administrative expenses increased 47% in the reported quarter to $289.4 million. This rise was due to continued investment in commercial activities for Rezdiffra, including increases in headcount to support marketing efforts.

Madrigal had cash, cash equivalents and marketable securities worth $838.9 million as of June 30, 2026, compared with $817.9 million as of March 31, 2026.

MDGL’s Key Pipeline & Other Updates

As the FDA and EU approved Rezdiffra under the accelerated pathway, the continued approval will be based on promising long-term safety and efficacy data from the pivotal phase III MAESTRO-NASH biopsy study. This late-stage study, which provided the data for the drug's accelerated approval for MASH, is ongoing as an outcomes study, with data expected in 2028. The goal is to generate confirmatory 54-month data to verify the drug's clinical benefits and support full approval for the noncirrhotic MASH indication.

In addition to the study, a second phase III outcomes study (MAESTRO-NASH OUTCOMES) is underway, evaluating the progression to liver decompensation events in patients with compensated MASH cirrhosis treated with Rezdiffra compared with placebo. Top-line data are expected in 2027. A positive outcome from this study is also expected to support the full approval of Rezdiffra for noncirrhotic MASH and expand the eligible patient population for Rezdiffra with an additional indication.

The open-label extension (OLE) arm of the MAESTRO-NAFLD-1 study is also currently evaluating the drug in patients with compensated MASH cirrhosis. In 2025, Madrigal reported positive two-year OLE data supporting Rezdiffra's potential benefit in compensated MASH cirrhosis and the ongoing MAESTRO-NASH OUTCOMES study. Additional data presented at the 2026 EASL Congress further demonstrated improvements in liver stiffness, MASH histology, cardiovascular risk markers and portal hypertension risk.

In May, Madrigal expanded its MASH pipeline through a licensing agreement with Arrowhead Pharmaceuticals for global rights to ARO-PNPLA3 (now referred to as MGL-0795), a clinical-stage siRNA candidate targeting the genetically validated PNPLA3 mutation linked to MASH. The asset is aimed at a genetically defined patient population representing roughly 30% of moderate-to-advanced fibrosis cases, with phase I data showing up to a 46% reduction in liver fat after a single high dose in PNPLA3 homozygous patients. Madrigal is currently awaiting consultation with the FDA on the design of a phase I combination study of MGL-0795 with Rezdiffra.

MDGL’s Zacks Rank & Stocks to Consider

Madrigal currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the biotech sector are Harmony Biosciences HRMY, Kiniksa Pharmaceuticals KNSA and Liquidia Corporation LQDA, each currently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Over the past 60 days, estimates for Harmony Biosciences’ 2026 earnings per share have risen from $3.20 to $3.30, while estimates for 2027 have increased from $3.64 to $3.87 during the same time. HRMY shares have lost 4.2% year to date.

Harmony Biosciences’ earnings missed estimates in each of the trailing four quarters, with the average negative surprise being 25.16%.

Over the past 60 days, estimates for Kiniksa Pharmaceuticals’ 2026 earnings per share have risen from $1.24 to $1.38, while estimates for 2027 have increased from $1.70 to $2.12 during the same time. KNSA shares have soared 89.5% year to date.

Kiniksa Pharmaceuticals’ earnings beat estimates in one of the trailing four quarters, met the same once and missed the same on the remaining two occasions, with the average negative surprise being 5.42%.

Over the past 60 days, estimates for Liquidia’s 2026 earnings per share have risen from $2.97 to $3.02, while estimates for 2027 have increased from $4.81 to $5.31 during the same time. LQDA shares have surged 151.5% year to date.

Liquidia’s earnings beat estimates in three of the trailing four quarters, while missing the same on the remaining occasion, with the average surprise being 54.40%.

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