Vericel Corporation

What they do

Vericel manufactures and markets autologous cell therapies: MACI, a cellularized scaffold implant for full-thickness knee cartilage defects in adults, and Epicel, a permanent skin replacement Humanitarian Use Device for deep-dermal or full-thickness burns covering at least 30% of total body surface area. It also holds North American rights from MediWound to NexoBrid, a topically applied biological orphan product for eschar removal in thermal burns. MACI and Epicel are made at the company's Cambridge, Massachusetts cell manufacturing facility; NexoBrid is manufactured by MediWound, primarily in Israel, with the active ingredient bromelain sourced from Taiwan. The company operates in one reportable segment.

Revenue drivers

• MACI — Third-generation autologous chondrocyte implantation product for knee cartilage repair, sold along with separately transacted MACI biopsy kits and MACI Arthro instruments used in arthroscopic delivery. Q2 2026 MACI net revenue was $65.5 million, about 85% of the $77.5 million quarterly total, up 23% year over year.
• Epicel — Permanent skin replacement (HUD) for adult and pediatric patients with deep-dermal or full-thickness burns covering at least 30% of TBSA. Q2 2026 Epicel net revenue was $10.4 million versus $8.6 million a year earlier, an approximately 21% increase.
• NexoBrid — Topically administered biological orphan product containing proteolytic enzymes for eschar removal in deep partial-thickness and/or full-thickness thermal burns, licensed for North America from MediWound. Q2 2026 NexoBrid net revenue was $1.5 million versus $1.2 million a year earlier, the smallest of the three marketed products.
• Burn Care franchise (Epicel plus NexoBrid) — Reported as a combined Burn Care line, which grew 22% to $12.0 million in Q2 2026 and 49% to $24.0 million in the first half of 2026.

Recent performance

For the second quarter ended June 30, 2026, total net revenue rose 22% to $77.5 million from $63.2 million in Q2 2025, with MACI up 23% to $65.5 million, Epicel up to $10.4 million, and NexoBrid up to $1.5 million. Gross profit was $56.4 million, or 73% of revenue, down from 74% a year earlier, while operating expenses rose to $56.0 million from $48.6 million. Net income was $2.2 million, or $0.04 per diluted share; operating cash flow was $16.2 million and free cash flow $14.3 million. First half 2026 revenue rose 26% to $145.9 million, with MACI up 22% to $121.9 million and Burn Care up 49% to $24.0 million. Full-year 2021-2025 revenue grew from $153.1 million to $276.3 million, and net income turned positive in 2024 ($10.4 million) and 2025 ($16.5 million).

Strategy

Management's stated objectives are to expand its leadership in sports medicine and severe burn care while delivering combined revenue and profitability growth. Named initiatives include further MACI growth, clinical indication expansion (including additional joints such as the ankle), international launch in select markets starting with the United Kingdom, expanding burn centers and surgeons using Epicel and NexoBrid, and generating positive operating income and cash flow. Manufacturing investment is focused on the approximately 126,000-square-foot Burlington, Massachusetts facility; in March 2026 the FDA approved beginning commercial MACI manufacturing there, and Vericel has started making a portion of MACI implants at the site and intends to move Epicel there later, subject to FDA qualification. The board authorized a $200 million share repurchase program, described as the company's first.

Risks

• Quarterly and annual fluctuations — Vericel states its results of operations may experience significant quarterly and annual fluctuations due to a number of factors.
• Historical losses and profitability durability — The company notes it incurred losses in the past and may not achieve consistent profitability for some time or at all, despite net income in 2024 and 2025.
• Manufacturing scale-up and facility qualification — Risks include the ability to scale manufacturing to meet demand for the cell therapy products, including timely qualification of the new Burlington, Massachusetts facility.
• Single-source and third-party supply — MACI depends on ACI-Maix collagen membranes supplied exclusively by Matricel GmbH, and NexoBrid is manufactured by MediWound, primarily in Israel, with bromelain sourced from Taiwan.

Outlook

For full-year 2026, guidance was raised to total revenue of $330 to $340 million, from $326 to $336 million previously, comprising MACI revenue of $284 to $290 million and Burn Care revenue of $46 to $50 million. Management reaffirmed full-year profitability guidance of roughly 75% gross margin and approximately 27% adjusted EBITDA margin. The company also announced a $200 million share repurchase authorization and stated it is well-positioned for sustained high revenue, profit and cash flow growth in 2026 and beyond.