Starling Oncology outlined a path to doubled capitated revenue and near-term profitability at the Wells Fargo 21st Annual Healthcare Conference on September 8, 2026, as the company moved from operating losses toward adjusted EBITDA breakeven.
Capitated revenue is expected to grow 100%, from $150 million to $300 million in 2027, with management stating the vast majority of that pipeline is already contracted or announced. Specialty pharmacy, which accounts for more than 60% of total revenue, grew 60% year-over-year in the latest quarter. Pharmacy gross margins climbed to 21.6% in the second quarter, following an above-20% reading in the first quarter—an expansion of roughly 300 basis points year-over-year.
Trailing twelve-month revenue reached $587 million, reflecting 38% growth. The company operates across five states with more than 300 providers and manages Part B risk for over 2 million patients. A California contract added 230,000 capitated lives and $6 million in annualized revenue beginning October 1. Outside California, the delegated capitation model—where health plans hand claims payment, network control and utilization management to Starling—can be deployed in 47 states.
Part D drug revenue represents 54% of the mix and carries less risk than Part B. Management said the company procures 95% of the Part B and Part D drugs it administers. On inflation-adjusted pricing, Starling says it has mitigated exposure to 2026IRA-affected drugs such as IMBRUVICA and is actively negotiating 2027 drug contracts, anticipating no price erosion from those discussions.
On the capital side, Starling refinanced a Deerfield Management convertible preferred note with a $75 million OrbiMed term loan and added a $25 million revolving credit facility. Debt maturities have been extended past 2031, and total debt stands at approximately $105 million following the refinancing. The market capitalization was $646 million, with trailing twelve-month negative EBITDA at $19 million. Adjusted EBITDA profitability is guided for 2026.
Chief Executive Officer Dan Virnich described Starling as the largest value-based oncology platform in the U.S., operating through a hybrid model of employed physicians and an independent provider network. He noted that tightening Medicare Advantage reimbursement can act as a tailwind: when plans face margin pressure, they seek partners who can manage medical loss ratios, which sit in the mid-80s for Starling compared with the mid-90s range typical in oncology. Oncology accounts for 8% to 11% of total Medicare Advantage premium.
Wall Street price targets range from $7 to $11 per share; the stock closed at $6.17 on the day.
