On Tuesday evening, Medexus Pharmaceuticals (TSX: MDP) (OTCQX: MEDXF) reported very impressive financials results for its Fiscal Q2 ending September 30th 2022, making it the company’s strongest quarter since inception. This quarter, MDP increased its revenues by 20% quarter-over-quarter, and 55% year-over-year, generating a total of USD $27.7 million or CAD ~$37.2 million during its second quarter.
MDP’s revenue growth this quarter was largely attributed to the increase in net sales of the company’s IXINITY product, a blood clotting medicine for hemophilia B, along with other pharmaceuticals such as Rupall, MDP’s antihistamines product saw unit demand growth surging 25% over a 12-month period. A majority of Medexus’s revenue comes from the United States, with the US accounting for ~74% of its sales, or USD $20 million generated in the US with USD $7.6 million coming from the Canadian marketplace. Additional growth came from Gleolan, an optical imaging agent which Medexus acquired the exclusive rights for commercialization in the United States, a great extension to its existing commercial rights to Gleolan for the Canadian market. With Medexus completing the full transaction for Gleolan during the quarter, shipments of MDP branded products began in August, and September was the company’s first full month of sales for Gleolan. MDP’s next set of financials, Q3 ended December 31, 2022, will be the first quarter where Medexus recognizes all the net sales for Gleolan in the US.
If you have been following MDP’s revenue growth from year to year, or quarter to quarter, and considering the stellar growth Medexus just announced, we believe that MDP’s Q3 could be equally impressive, as sales from new products become fully recognized on the company’s balance sheet.
The CEO of MDP Mr. Ken d’Entremont was quoted, “This was an excellent quarter for Medexus, demonstrating both the robustness of our product portfolio and our initiatives to improve margins and drive sales. Preliminary results of our IXINITY manufacturing initiative have started to produce improved yields, which contributed to this quarter’s improvements in our gross margins. During the quarter, we delivered organic growth across all our leading prescription products, and completed the transition to full commercial responsibility for Gleolan in the U.S. We are excited to see Gleolan’s contribution over the coming quarters as we execute on our commercial plan, which includes improved sales and marketing initiatives.”
Is Medexus a Buy? That is precisely the title of our recent article we published last week, where we delved into its recent developments in light of its second quarter being due the following week. On November 1st, 2022, we published our article on MDP which traded at a low of $1.49 and rallied 38.5% intraday, with MDP’s stock increasing 66% since the publication of our article. The recent run into earnings was short lived, with MDP closing the day today at $1.75, however if pressure continues and approaches a price point of $1.30,we would view this as a good opportunity.

In September 2022, MDP announced that its partner Medac received a second notice of incomplete response from the FDA for its new drug application for treosulfan. As a result of the unfavourable news, the stock did take a big dip, having since recovered. Treosulfan is medication given to patients prior to receiving bone marrow transplant. Although the NDA was returned to Medac for resubmission, treosulfan is already designated orphan drug in the US and was approved by Health Canada in June 2021. It’s very encouraging to see that treosulfan is already approved by a well recognized government health regulator such as Health Canada. The optimism for FDA approval would be different had treosulfan been in its infancy stage with not a single approval from any health regulator. On the positive side, the FDA is only requesting additional supporting information, but does not require new data to be submitted.
Medexus Pharmaceuticals is closing in on a strong 2022, with consecutive increases in revenue every quarter, and a looming FDA approval for treosulfan, we think MDP is shaping up to have spectacular 2023.
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