Medexus Announces Fiscal Q1 2026 Results, Including Positive Results from US Launch of GRAFAPEX (treosulfan) for Injection

Executive Summary

• Medexus Pharmaceuticals reported fiscal Q1 2026 financial results, posting net revenue of $24.6 million (down 9.9% year-over-year) and net income of $0.5 million, driven by the first full quarter of commercial sales for GRAFAPEX.
• The company provided a business update on GRAFAPEX, noting $3.0 million in product-level net revenue and significant formulary progress, including approvals from nine large commercial payers covering 48 million patient lives and 14 healthcare institutions.
• Management highlighted the successful launch of GRAFAPEX in the US, including CMS New Technology Add-On Payment (NTAP) approval for FY2026, while noting headwinds from generic competition affecting legacy products like Rupall and Metoject.

Key Details

• Financial Performance (Fiscal Q1 2026):
  • Net Revenue: $24.6 million (decrease of $2.7 million or 9.9% vs. $27.3 million in Q1 2025).
  • Net Income: $0.5 million (decrease of $1.5 million vs. $2.0 million in Q1 2025).
  • Operating Income: $0.9 million (decrease of $3.1 million or 77.5% vs. $4.0 million in Q1 2025).
  • Adjusted EBITDA: $3.4 million (decrease of $2.7 million or 44.3% vs. $6.1 million in Q1 2025).
  • Gross Margin: 56.0% (vs. 54.4% in Q1 2025).
  • Adjusted Gross Margin: 65.5% (vs. 59.3% in Q1 2025).
  • Cash from Operating Activities: $3.9 million.
  • Available Liquidity: $9.3 million as of June 30, 2025.
  • Debt Reduction: Total debt reduced by $15.5 million in Q1 2026, with remaining scheduled principal payments of $1.1 million in September and December 2025.
• GRAFAPEX Commercial Update:
  • Product-level net revenue: $3.0 million in Q1 2026.
  • Formulary Inclusion: Nine large commercial payers (covering ~48 million patient lives) and 14 healthcare institutions (8% of US transplant centers) have made positive formulary inclusion determinations.
  • Prior Authorization: 29 additional commercial payers have added GRAFAPEX to prior authorization lists.
  • Wholesaler Data: 36 of 180 US transplant centers (representing ~24% of annual allo-HSCT procedures) have ordered GRAFAPEX.
  • Revenue Guidance: Expected product-level net revenue of $3.0 million to $3.5 million for fiscal Q2 2026.
  • Cash Flow Expectation: GRAFAPEX expected to be accretive to quarterly operating cash flows by fiscal Q3 2026 (calendar Q4 2025).
  • Margin Expectation: Annual product-level Adjusted Gross Margin expected to be approximately 80%.
  • Regulatory: CMS approved New Technology Add-On Payment (NTAP) for FY2026 (Oct 1, 2025 – Sep 30, 2026), providing supplemental reimbursement of up to $21,411 per eligible case.
  • Tariffs: Preliminary assessment indicates 15% US tariffs on EU imports will apply to GRAFAPEX, but impact is not expected to be material.
• Legacy Product Performance:
  • Rupall (Canada): Market exclusivity expired Jan 2025; unit demand decreased 29% in the six months ended June 2025 due to generic competition. Effective unit-level price reductions implemented.
  • Trecondyv (Canada): Unit demand grew 38% over the trailing 12 months ended June 2025. Public reimbursement listing agreements completed with Ontario, British Columbia, Quebec, and Manitoba.
  • IXINITY (US): Unit demand decreased 1% over the trailing 12 months ended June 2025; expected to remain relatively stable.
  • Rasuvo (US): Unit demand decreased 5% over the trailing 12 months ended June 2025 due to sustained competition. 15% tariff expected to apply but not material.
  • Metoject (Canada): Unit demand decreased 5% over the trailing 12 months ended June 2025 due to generic competition (second generic launched March 2024).

Notable Quotes

• "The strong initial performance of GRAFAPEX™ is particularly important as other products in our portfolio shift to the later stages of their product life cycle... Over time, we expect product-level performance of GRAFAPEX™ to significantly outweigh the relatively smaller impact of this decline in Rupall product-level performance in this transitional period." — Ken d'Entremont, CEO
• "We are very pleased with the successful launch of GRAFAPEX™ in the United States... The positive initial response we have seen to date... supports our expectation that GRAFAPEX™ will be accretive to quarterly operating cash flows by calendar Q4 2025." — Ken d'Entremont, CEO
• "We achieved $0.5 million of positive net income for fiscal Q1 2026, and a healthy $3.4 million of Adjusted EBITDA* from $24.6 million of net revenue... substantially reducing total debt under our credit facilities by $15.5 million in fiscal Q1 2026." — Brendon Buschman, CFO