Medexus Announces Fiscal Q2 2026 Results, Driven by Strong Year-To-Date Product-Level Performance of GRAFAPEX (treosulfan) for Injection

Executive Summary

• Medexus Pharmaceuticals reported fiscal Q2 2026 results (three‑ and six‑month periods ended September 30, 2025), showing net revenue of $24.7 M and $49.4 M respectively – down 6–8% year‑over‑year due to generic erosion on Rupall and termination of the U.S. Gleolan agreement.
• Adjusted EBITDA was $4.4 M (three‑month) and $7.8 M (six‑month), a decline of 27% and 35% YoY, but marked the second consecutive quarter of adjusted EBITDA growth since GRAFAPEX launch.
• GRAFAPEX product‑level net revenue reached $3.1 M and $6.2 M for the three‑ and six‑month periods, exceeding prior‑year levels and supporting a higher gross margin (55.7%/55.8%) and Adjusted Gross Margin (65.2%/65.4%).

Key Details

• Revenue & Margins
• Net revenue: $24.7 M (3‑mo) / $49.4 M (6‑mo), ↓6.1% / ↓7.8% YoY.
• Gross margin: 55.7% / 55.8%; Adjusted gross margin: 65.2% / 65.4%.
• Adjusted EBITDA
• $4.4 M (3‑mo) / $7.8 M (6‑mo), ↓27% / ↓35% YoY, but still growth vs. prior quarter.
• Operating Income
• $1.4 M (3‑mo) / $2.2 M (6‑mo), down 12.5% / 60.7% YoY.
• Net Income/Loss
• Net loss of $0.3 M (3‑mo) vs. net income $0.1 M prior year; net income $0.2 M (6‑mo) vs. $2.1 M prior year.
• Liquidity & Debt
• Cash & cash equivalents: $9.4 M as of Sept 30, 2025 (down from $24.0 M Mar 31, 2025).
• Principal repayments under BMO Credit Agreement: $16.6 M since March 31, 2025; total long‑term debt now $21.1 M.
• Cash Flow
• Operating cash provided: $3.3 M (3‑mo) / $7.3 M (6‑mo), ↓$3.6 M / ↓$7.7 M YoY.
• Product Highlights
• GRAFAPEX (US) – Net revenue $3.1 M / $6.2 M; 83% of 180 US transplant centers engaged, 29% have placed orders, 69% of those reordered. Expected to be cash‑flow accretive starting Q4 2025 (calendar Q3 2026).
• NTAP Reimbursement – CMS approved New Technology Add‑On Payment for GRAFAPEX (max $21,411 per case) beginning Oct 1, 2025; eligibility expected to continue for up to two additional fiscal years.
• Tariff Impact – July 2025 EU pharmaceutical tariff of 15% announced; Medexus expects no material impact on FY 2027 performance.
• IXINITY (US) – $4.0 M manufacturing upgrade and $2.0 M test batch in FY 2026; $1.2 M payable in FY 2026.
• Rupall (Canada) – Market exclusivity expired Jan 2025; unit demand down ~55–58% YoY, prompting pricing adjustments and expense reductions.
• Guidance & Outlook
• Management expects GRAFAPEX to exceed $100 M annual net revenue within five years post‑launch.
• Anticipates continued quarter‑over‑quarter momentum and further cash‑flow contribution from GRAFAPEX in fiscal Q3 2026.

Notable Quotes

• “Product‑level performance of GRAFAPEX to date has exceeded our expectations… we are confident that GRAFAPEX will be accretive to quarterly operating cash flows by calendar Q4 2025.” – Ken d'Entremont, CEO
• “We achieved $3.3 M of cash flow from operating activities for fiscal Q2 2026…and have substantially reduced total debt by $16.6 M since March 31 2025.” – Brendon Buschman, CFO

Materiality Assessment

Material – Neutral – The release contains full quarterly financial results, liquidity changes, and operational updates that are material to investors, though the overall performance trend is mixed (revenue decline but margin improvement and cash‑flow generation).