KRYS Stock Surges 57% in a Year: More Upside Potential in 2026?

Shares of Krystal Biotech KRYS have surged 57.2% in a year compared with the industry’s growth of 17.1%. The stock has also outperformed the industry and the sector in this time frame.

The strong rally can be attributed to strong uptake of Vyjuvek and encouraging pipeline progress.

KRYS Outperforms Industry, Sector & S&P 500

Strong Uptake of KRYS’ Vyjuvek  

In May 2023, the FDA approved Vyjuvek, the first-ever revocable gene therapy for treating patients aged six months or older with dystrophic epidermolysis bullosa (DEB).

In September 2025, the regulatory body approved a label update for Vyjuvek that expanded the treatment-eligible population to include DEB patients from birth and provided patients with greater dosing flexibility, including the option for the therapy to be applied by a healthcare professional, caregiver, or directly by the patient themselves, either at home or in a healthcare setting.

DEB is a rare and severe monogenic disease that affects the skin and mucosal tissues. It is caused by one or more mutations in a gene called COL7A1.

The therapy was also approved in Japan and Europe earlier this year, making it the first and only corrective therapy approved for the treatment of DEB in each of those respective markets.

As of Nov. 3, 2025, Krystal secured over 615 reimbursement approvals for Vyjuvek in the United States and continues to maintain strong access nationwide.

Sales should gain further traction backed by approvals in additional geographies.

KRYS’ Encouraging Pipeline Progress

On the respiratory front, the company has two candidates in its pipeline — KB407 and KB408.

The company is evaluating KB407 for the treatment of cystic fibrosis (CF). Enrollment continues in Cohort 3 of CORAL-1, a multi-center dose escalation trial evaluating KB407 in CF patients regardless of genotype. Interim data from Cohort 3 are expected shortly.

KB408 is being evaluated for the treatment of alpha-1 antitrypsin deficiency lung disease. Enrollment is ongoing in repeat-dose Cohort 2B of the SERPENTINE-1 study, with interim results expected in the first half of 2026.

In the ophthalmology space, another candidate, KB803, is being evaluated for the treatment and prevention of corneal abrasions in DEB patients. Krystal Biotech expects to complete enrollment shortly in IOLITE, a phase III randomized, placebo-controlled crossover study evaluating KB803 for the treatment and prevention of corneal abrasions in DEB patients.

Krystal is also evaluating KB801 for the treatment of neurotrophic keratitis (NK). A phase II randomized, double-masked, placebo-controlled trial, EMERALD-1, is evaluating the safety and tolerability of topical ocular administration of KB801 in patients with NK. The study is currently enrolling.

Meanwhile, in October, the FDA granted platform technology designation to the HSV-1 vector technology used in KB801, enabling efficiencies in manufacturing and regulatory review.

On the oncology front, Krystal has a promising candidate, KB707, in its kitty which is being developed for the treatment of solid tumors of the lung.

In August, the FDA had granted the company an end of phase II meeting to discuss the inhaled KB707 program and early evidence of efficacy for the treatment of non-small cell lung cancer (NSCLC) from the ongoing open label, multi-center, dose escalation study KYANITE-1.

Based on the FDA’s feedback, Krystal expects a single phase III registrational trial comparing inhaled KB707 plus chemotherapy versus chemotherapy alone as a second-line NSCLC treatment to support potential registration of inhaled KB707 in combination with chemotherapy as a second-line treatment for NSCLC.

Consequently, in support of this potential registrational pathway, Krystal opened a new cohort in KYANITE-1 to evaluate a fixed inhaled dose of KB707, in combination with chemotherapy in patients with advanced NSCLC. Enrollment in KYANITE-1 is ongoing. Krystal expects to report interim efficacy data and potential registrational study plans in the second half of 2026.

In the aesthetics space, the company’s wholly owned subsidiary, Jeune Aesthetics, is currently developing KB304 for the treatment of wrinkles of the décolleté.  Jeune Aesthetics remains on track to initiate a phase II study of its lead program KB304 in the first half of 2026.

On the dermatology front, a phase I/II intra-patient randomized, double-blind, placebo-controlled clinical study on KB111 for the treatment of Hailey-Hailey disease is expected to begin dosing in the first half of 2026.

The successful development of additional drugs will broaden Krystal’s portfolio.

KRYS’s Valuation and Estimate Movement

Going by the price/earnings ratio, KRYS’ shares currently trade at 29.39x forward earnings, higher than its mean of 20.70x but lower than 38.95x for the biotech industry.

The Zacks Consensus Estimate for 2025 earnings per share (EPS) has increased to $6.45 from $6.18 over the past 60 days. The EPS estimate for 2026 has also moved north.

Invest in KRYS Stock

Large biotech companies are generally considered safe havens for investors interested in this sector. Despite the stupendous rally in 2025, we believe KRYS still has room to grow, considering its good fundamentals and growth prospects. We recommend the stock to prospective investors.

The prospects for Krystal look strong as Vyjuvek is the first FDA-approved gene therapy treatment for DEB. The successful development of other pipeline candidates should bode well too.

With a cash balance of $864.2 million as of Sept. 30, 2025, the company seems to be in a good position to develop its pipeline candidates.

Krystal’s Zacks Rank & Other Stocks to Consider

Krystal sports a Zacks Rank #1 (Strong Buy) at present. A couple of other top-ranked stocks in the pharma/biotech sector are CorMedix CRMD and Amicus Therapeutics FOLD, each carrying a Zacks Rank #1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

In the past 60 days, estimates for CorMedix’s 2025 EP6 have increased from $2.49 to $2.88. CorMedix’s earnings beat estimates in each of the trailing four quarters, with an average surprise of 27.04%.

In the past 60 days, estimates for Amicus Therapeutics’ 2026 EPS have decreased to 67 cents from 70 cents. Shares of FOLD have gained 51.1% in a year. 
  

 

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This article originally published on Zacks Investment Research (zacks.com).

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