This is a make-or-break year for Coherus Oncology. But there won't be much making or breaking until five expected data readouts are announced beginning in mid-2026.

Then again, there could be some breaking before clinical data arrive.

According to the annual report, Coherus is on the hook for $64.5 million in Udenyca transition service agreement (TSA) payments. That dwarfs the net payables reported at the end of September 2025, which stood at less than $13 million. The company expects to settle payables with cash in a "front-loaded" manner throughout 2026.

This unexpected development throws a wrench in the investment opportunity, explains the recent public offering of common stock, and makes the data readouts even more decisive for the investment thesis.

In other words, investors need to keep expectations in check. Both tagmokitug and casdozokitug could make significant contributions to the company's valuation with additional de-risking, but early, mixed, or disappointing results would complicate the calculus for investors.

By the Numbers

Coherus is a commercial-stage drug developer, but Loqtorzi's current approval in NPC isn't a high-impact indication. Management expects to capture about 70% of the estimated $250 million market opportunity, or roughly $175 million, once the asset reaches its peak in 2028. I expect closer to $150 million based on an annualized exit rate of roughly $37.5 million in Q4 2028.

The current trajectory doesn't instill much confidence in either being achieved by 2028.

Loqtorzi scratched and clawed its way to full-year 2025 revenue of $40.8 million. It's unlikely to generate more than $60 million in annual revenue this year. Coherus says it's struggling to ramp the asset because NPC is a rare cancer. With fewer than 2,000 patients in the United States, it's difficult to find patients. Many specialists only see one or two cases per year, and tumors can be misdiagnosed as other throat or neck cancers.

The result: the ramp is about 12 months behind. Not long ago, investors thought Loqtorzi could reach $15 million in quarterly revenue exiting 2025. Now that milestone isn't expected until Q4 2026.

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Although the business is marching gross margin higher, there's simply not enough revenue for that to make a dent in operations yet. The gross profit in Q4 offset 25 days of R&D expenses – and nothing else.

Total operating expenses in 2025 were significantly lower than previous years, but trended upward as R&D expenses swelled in response to the company's aggressive clinical posture. Coherus spent the most on research since Q1 2023, which is only going to become more expensive as assets mature.

The business coughed up a $45.9 million operating loss in Q4, nearly identical to every other quarter in 2025. However, it reported an operating cash outflow of only $19.7 million, the best of the year. The improvement was driven by one-time accounting events though.

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Udenyca TSA Payables, Explained

The most alarming development for investors stems from the Udenyca divestiture. Coherus has to pay $64.5 million in cash to settle its final obligations. What happened?

When the brand was sold to Intas Pharma, Coherus couldn't immediately transfer all contracts for manufacturing or rebate management for insurance payors. So, the pair agreed to the Udenyca transition services agreement (TSA). The company executed TSA contracts for Cimerli and Yusimry previously, so this wasn't unusual.

Coherus agreed to continue handling certain responsibilities on behalf of Intas, acting as an agent for the Udenyca franchise, and to be reimbursed for those services later. These debits and credits were accounted for on the balance sheet as TSA receivables (an asset, tracking payment for services) and TSA payables and liabilities (a liability, tracking expenses incurred for services). The idea was that TSA receivables would cancel out TSA payables, resulting in a net impact close to zero.

That changed unexpectedly exiting 2025.

• In Q3, the balance sheet held about $12.5 million Udenyca TSA payables, net – meaning the business would be expected to pay $12.5 million. That wasn't an alarming amount, especially relative to the size of the Udenyca asset sale ($483 million upfront).
• In Q4, the balance sheet held about $64.5 million Udenyca TSA payables, net. There are no more TSA receivables to offset the TSA payables, which means the business needs to use cash to settle this amount.

This is a terrible development at the worst possible time.

Consider that Coherus began the year with a cash position of $172 million. It raised net proceeds of $47 million in the public offering of common stock completed in February 2026. It's burning about $45 million in cash per quarter.

Excluding the TSA payables liability, investors could expect:

• By the end of Q1 2026 (March 31), the cash balance might be $174 million.
• By the end of Q2 2026 (June 30), the cash balance might be $129 million.
• By the end of Q3 2026 (September 30), the cash balance might be $84 million.
• By the end of Q4 2026 (December 31), the cash balance might be $39 million.

When's the best time to write a check for $64.5 million?

The annual report says, "The use of cash to settle TSA payables and accrued liabilities is expected to occur in a front-loaded fashion over the remainder of 2026." I suppose we could interpret that to mean a higher share will be paid in 1H 2026 than 2H 2026, but the timing hasn't been explained. Heck, investors don't even know what caused a sudden gap between TSA receivables and TSA payables.

There aren't many good options for making this suck less.

Monetizing the Udenyca milestone(s)

Coherus said it's on track to earn the first $37.5 million sales-based milestone for Udenyca. To do so, the franchise needs to generate total revenue of $300 million in the 12-month period beginning Q3 2025 or Q4 2025. It's tempting to extrapolate the trajectory from right before the asset sale, but the real world isn't a spreadsheet. Extrapolations must assume Intas can match the high bar of commercial execution set by Coherus across its biosimilar brands. Can you confidently assume that? I can't.

Investors might expect the business to monetize this milestone sooner given its cash position. It could potentially throw in the second $37.5 million sales-based milestone, but due to the uncertainty and time duration, wouldn't receive the full $75 million underpinned by the milestones. But selling the Udenyca milestones for an extra $50 million to $60 million in cash upfront – and leaving a little money on the table, potentially – would alleviate the Udenyca TSA payables problem.

Data readouts

There will also be five data readouts in 2026, including two this summer and another one likely in Q3. That timing could work out, but it also requires positive data readouts, the willingness to overlook the drawbacks of preliminary data, and excitement for CCR8 inhibitors as a drug class. The market may not get excited about early tagmokitug data in handfuls of patients across multiple dosing levels. It's unlikely there will be clear data signals.

More simply, the data readouts don't guarantee a positive response in the stock price, which is required for Coherus to be able to raise capital.

Runaway dilution

This extra $64.5 million cash expense really mucks with the investment thesis by risking runaway dilution. Coherus has to use precious cash to wrap up prior obligations (Udenyca) instead of supporting operations (the value driver). It doesn't have enough cash to support operations, which means it'll need to dilute investors even more in the near future.

Ironically, I used to be attracted to the business in part because it maintained below-average dilution for many years.

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The business has 180.803 million shares on a fully-diluted basis, which includes issuable stock options and restricted stock units (RSUs). That's 21% higher than the outstanding share count. In other words, the stock closed at $1.78 per share on March 11, but an equivalent valuation on a fully-diluted basis would be $1.41 per share. This primarily affects the calculus for acquisitions. For example, a $1 billion acquisition would be equivalent to only $5.53 per share.

Think about what dilution means in the context of needing to raise more capital.

Dilution means more shares outstanding, which makes each share worth less. A lower share price means a company must issue more shares to raise the same amount of money. For example, if Coherus wants to raise $150 million gross – roughly one year of runway – from a public stock offering:

• If the share price was $10 per share, then the company would need to issue 15 million shares.
• If the share price was $5 per share, then the company would need to issue 30 million shares.

Dilution can easily spiral out of control. Look at Iovance Biotherapeutics. The cell therapy developer has earned a higher valuation by grounding shareholders into a pulp with never-ending dilution.

News Flow & Modeling Insights

(Reduced to account for full dilution.)

The current model reflects expectations for full-year 2026 operations on a fully-diluted, pre-data readout basis.

• Outstanding share count of 185.104 million, which is a fully-diluted basis accounting for 30.717 million issuable stock options and restricted stock units (RSUs)
• Full-year 2026 Loqtorzi revenue of $57.678 million
• Loqtorzi in nasopharyngeal carcinoma (NPC) contributes roughly $152 million to the model, or $0.96 per share on a fully-diluted basis
• The pipeline contributes a pre-data readout component of $263 million to the modeled valuation, including $184 million from the IL-27 inhibitor casdozokitug and $79 million from the CCR8 inhibitor tagmokitug

Margin of Safety & Conviction

(Decreased.)

Coherus Oncology is considered a Future Compounder position with the following Conviction rating.

• 1 = High (previous)
• 2 = Above Average
• 3 = Average (current)
• 4 = Below Average

The estimated fair valuation based on my current model is below:

• Market close March 11: $1.78 per share
• Modeled Fair Valuation: $2.24 per share
• Allocation Range: Up to 5% (previously up to 10%)

Coherus Oncology reported 149.890 million shares outstanding as of February 28, 2026. The modeled fair valuation above assumes 185.104 million shares outstanding, which is equivalent to 3% dilution and accounting for all issuable shares.

Further Reading

• March 2026 press release announcing Q4 2025 operating results
• March 2026 regulatory filing (10-K) detailing Q4 2025 operating results
• February 2026 quarterly earnings preview for the Solt DB coverage ecosystem