Medicus Pharma Q3 2026 Earnings Call Transcript

Medicus Pharma (NASDAQ:MDCX) reported third-quarter financial results on Monday. The transcript from the company’s third-quarter earnings call has been provided below.

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Summary

Medicus Pharma reported a net loss of $35.9 million for the first nine months of 2026, while operating expenses increased to $34.5 million from $26.6 million in the previous year.

The company secured a co-development and license agreement with Pfizer for the clinical-stage antibody-drug conjugate CD228V, initially focusing on melanoma, with Pfizer contributing $2 million for development activities.

A proposed business combination involving Skinjet at a $135 million pre-money enterprise valuation is underway, with completion targeted for the first half of 2027. The transaction aims to unlock value while Medicus retains majority ownership.

Medicus raised $42.5 million through equity and secured debt financing, with plans to allocate capital efficiently toward CD228V and maintain readiness for Tavarellix partnerships.

Management emphasized a strategic focus on advancing clinical milestones, aligning costs and pursuing strategic partnerships to enhance shareholder value.

Full Transcript

OPERATOR

Welcome to the Medicus Pharma third quarter 2026 financial performance and business update conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today’s presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on your telephone keypad. To withdraw your question, please press star and then two.

Please note this event is being recorded. I would now like to turn the conference over to Anna Djokovic, Senior Vice President of Investor Relations. Please go ahead.

Anna Djokovic (Senior Vice President, Investor Relations)

Thank you. Hello and welcome. This is Anna Djokovic, Senior Vice President, Investor Relations at Medicus Pharma. Thank you for joining our financial performance and business update call for the third quarter and nine months ended September 30, 2026. Joining me today are Dr. Raza Bokhari, our Executive Chairman and Chief Executive Officer; Karen Bonner, our President and Chief Financial Officer; and Dr. Faisal Mehmud, our Chief Medical Officer. Before we begin, some of the matters discussed today contain forward-looking statements within the meaning of applicable securities laws, including statements about clinical development, regulatory plans, the Pfizer collaboration, potential partnerships, the proposed Skinjet business combination and related financing, financing requirements, and NASDAQ compliance. These statements reflect management’s current expectations as of today and are subject to risks and uncertainties that could cause actual results to differ materially.

Please review the risks described in our most recent annual report on Form 10-K, our quarterly report on Form 10-Q, and other SEC filings. Medicus undertakes no obligation to update forward-looking statements except as required by law. All financial amounts discussed are in U.S. dollars. Our product candidates are investigational and have not been approved by the FDA or any other regulatory authority for commercial sale. With that, I would like to turn the call over to Dr. Raza Bokhari. Dr. Bokhari.

Raza Bokhari (Chief Executive Officer)

Thank you, Anna. On behalf of the entire Medicus team, thank you all for joining us today. During the first nine months of 2026, Medicus took an important step in its transformation into a precision oncology-led biotechnology company advancing a capital-efficient drug development strategy. Our agreement with Pfizer gives us worldwide rights to a clinical-stage antibody-drug conjugate with a differentiated target and a substantial scientific and development foundation.

We believe this creates an opportunity to build long-term shareholder value by advancing a potential new treatment for patients whose cancer resists existing therapies. We have also announced a non-binding letter of intent for a proposed business combination involving Skinjet at a $135 million pre-money enterprise valuation, with concurrent equity financing contemplated at closing of the business combination. We believe a separately listed Skinjet company in which Medicus seeks to retain majority economic and voting ownership could unlock value for shareholders and support development in Golden Syndrome while allowing Medicus to concentrate incremental investment on precision oncology.

Now I will go into some relevant details of the Pfizer agreement. On September 2nd, through our wholly owned subsidiary Medicus Pharma Inc., doing business as Medicus Oncology, we entered into a co-development and license agreement with Pfizer for PF08046031, which we refer to as CD228V. Subject to the agreement’s retained rights and other provisions, we hold an exclusive worldwide license to develop, manufacture, and commercialize the program. Medicus has authority over program execution, including development, manufacturing, regulatory approval, and commercialization.

Pfizer remains involved under the co-development framework. Pfizer also provided $2 million for development activities and retains the right, without an obligation, to elect to fund all or part of the development beginning with the first pivotal trial. CD228V is a second-generation construct originating from CGEN and subsequently advanced by Pfizer. The earlier molecule SGN-CD228A generated preliminary clinical observations and insights into the target, safety, and biomarkers. CD228V uses Pfizer’s established Vedotin linker-payload platform, with changes to the linker and the amount of payload carried by each antibody. It is our understanding these refinements were designed to improve the balance between drug exposure, tolerability, and antitumor activity.

Our decision to enter into the co-development and license agreement with Pfizer was informed by our review of the clinical data from CGEN’s open-label Phase 1 study of SGN-CD228A, which enrolled 88 patients with advanced solid tumors, including melanoma and non-small cell lung cancer. Detailed findings from that study have not yet been publicly disclosed. Our review of those data, together with Pfizer’s scientific rationale for reconstructing the linker-payload using Vedotin, gave us confidence in the therapeutic potential of CD228V.

The Vedotin linker-payload technology has established clinical and regulatory precedent through its use in FDA-approved ADC therapies. Our initial focus is melanoma, particularly disease that has relapsed, become refractory, or resisted immunotherapy. We believe this is a compelling starting point based on CD228 biology and the available expression data. Concentrating on a defined patient population allows us to ask a focused clinical question and use the resulting evidence to guide future investment. Based on our assessment of the available clinical evidence from CGEN’s SGN-CD228A study and the potential benefit of Pfizer’s linker-payload reconstruction, we believe CD228V has the potential to achieve an objective response rate exceeding 30% in melanoma.

This would represent a clinically meaningful efficacy benchmark that could support a future FDA monotherapy registration strategy, subject to demonstration of durable responses, an acceptable safety profile, and applicable regulatory requirements. This potential remains to be demonstrated in clinical trials of CD228V. We see Medicus as part of an emerging group of approximately 30 clinical-stage ADC developers across the globe. At one end of this field are established companies with approved products and extensive development capabilities. At the other end are companies with programs still in clinical research and development. Through CD228V, Medicus has a clinical-stage asset built on an established ADC platform. Our agreement with Pfizer also places Medicus amongst a list of handful companies advancing CGEN-linked ADC assets through Pfizer collaborations.

The rights, economics, and clinical maturity of those relationships differ. For our shareholders, we believe the opportunity lies in the combination of our worldwide rights, the clinical evidence that we already have, and the clinical evidence we intend to generate, which could support a broader development program and inform future licensing, co-development, or other strategic discussions. We intend to earn that opportunity through our clinical progress while directing capital towards the milestones most likely to improve our understanding of the asset.

Now I will turn to relevant progress for our Skinjet asset and proposed business combination. I’m excited to share that we announced on November 4 that Skinjet has entered into a non-binding letter of intent with an undisclosed SPAC. The proposed business combination contemplates a $135 million pre-money enterprise value for Skinjet, with concurrent equity financing at closing to support the Skinjet 005 study in Golden Syndrome and preparation and submission of a potential new drug application.

Our projected estimate for this program is approximately $3 million spread over the next two years. Under the proposed terms, the SPAC would acquire 100% of Skinjet in exchange for newly issued common shares of the combined company. Our objective is for Medicus to retain majority economic and voting ownership of the combined company. We believe a separately listed company with its own public market access and dedicated financing platform could help unlock Skinjet’s value while preserving Medicus shareholders’ participation in its potential future growth.

We will continue allocating essential resources to maintain program readiness as the proposed transaction progresses. We currently anticipate completing the proposed business combination during the first half of 2027. There can be no assurance that definitive agreements will be signed, that financing will be secured, or that the transaction will close within that time frame or at all. Now I will move to our Tavarellix with relevant updates. As we advance our transformation into a precision oncology-led biotechnology company, we increasingly view Tavarellix as offering partner-ready opportunities in acute urinary retention relapse prevention, advanced prostate cancer, and women’s health. Our optimized prostate cancer protocol remains subject to FDA feedback. We are maintaining program readiness while seeking partners with the capability and resources to advance these opportunities across the portfolio.

Our priority is to concentrate incremental development investment on CD228V, pursue the proposed Skinjet transaction, and preserve Tavarellix’s partnering readiness. Our financial results reflect the cost of establishing our portfolio of assets, including the recently completed co-development and licensing agreement with Pfizer for CD228V. I will now turn the call over to our President and Chief Financial Officer, Carolyn Bonner, for the financial review.

Carolyn Bonner (Chief Financial Officer)

Thank you, Raza. During the nine months ended September 30, 2026, we raised approximately $42.5 million through equity and secured debt financing, net of issuance costs. After approximately $6.4 million of debt repayments, net cash provided by financing activities was $36.2 million. This capital was instrumental in supporting Medicus’ transformation into a precision oncology-led biotechnology company. It enabled us to secure the worldwide CD228V license from Pfizer and supported capital-efficient development across our portfolio.

For the first nine months, operating expenses were $34.5 million compared with $26.6 million a year earlier. This included $15 million of general and administrative expense, $9.6 million of R&D expense, and a $10 million acquired IPR&D charge for CD228V, which reflects the $12 million upfront payment to Pfizer, net of the $2 million development funding payment we received from Pfizer. Net loss was $35.9 million compared with $27.3 million. For the third quarter, operating expenses were $14.5 million compared with $15.4 million, and net loss was $15.2 million compared with $16 million. On September 30th, we held $13.1 million in combined cash, cash equivalents, and restricted cash. This consisted of $5 million in cash and cash equivalents and $8.1 million in restricted cash. Cash and cash equivalents on December 31, 2025 were $8.7 million. On September 30, our total liabilities were $25 million, primarily due to the Streeterville Capital debenture executed on May 27, 2026.

Our liabilities on December 31, 2025 were $10 million. I refer you to our Form 10-Q for additional details regarding the company’s finances. Our financial priority is to direct incremental capital toward CD228V while allocating essential resources to maintain the value and partnering readiness of Tavarellix and pursue the proposed Skinjet transaction. We anticipate a substantial reduction in our operating expenses in the coming quarters. That concludes my financial review. Anna, I will turn the call back to you for questions.

Anna Djokovic (Senior Vice President, Investor Relations)

Thank you, Carolyn. Operator, please open the call for questions.

OPERATOR

We will now begin the question-and-answer session. To ask a question, you may press star, then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star and then two. Our first question comes from Kumar Raja with Brookline Capital. Please go ahead.

Kumar Raja (Analyst)

Good morning. Congratulations on all the progress, and thanks for taking my questions. First, with regard to CD228V, when can we expect the next clinical and regulatory milestones under this collaboration?

Raza Bokhari (Chief Executive Officer)

Thank you, Kumar, for the question and for your support. I will turn it over to Dr. Faisal Mehmud, our Chief Medical Officer, to address your question, keeping in mind that we are 60 days into completing the transaction and we are still assimilating and getting our arms wrapped around the program details. But over to Faisal.

Faisal Mehmud (Chief Medical Officer)

Thank you very much for the question. I think the most important point is that we are not starting from a blank sheet of paper. We have an existing clinical foundation, the manufacturing knowledge, and the prior regulatory experience associated with the program. So as Raza mentioned, our immediate priority is to translate those advantages into an efficient development plan, which we’re constructing right at this moment, and we want to get to the next meaningful clinical decision point as quickly and as responsibly as possible.

So more on that to follow, but we’re just under 60 days from when we’ve completed. We’re still assimilating all the information, but we’re going to be going from a running start, which is exciting.

Kumar Raja (Analyst)

Okay. And I had one more question on the SPAC business combination. You mentioned that the potential closing would be in the first half of 2027. So my question is, with regard to clinically advancing that program, will you be waiting for that combination to close before you proceed forward with clinical programs for Skinjet? Thank you.

Raza Bokhari (Chief Executive Officer)

Thank you, Kumar. Really appreciate that. Very insightful question. Medicus will continue to advance the progress for Skinjet towards Kinjet 005 in parallel while we are moving forward to contemplate this contemplated transaction into a reality. As I have described in our prepared remarks, our projected budget for this— to get this to a new drug application stage— to the extent that we can satisfy all the scientific rigor and meet the thresholds that the FDA expects in this registrational or NDA-enabling study, that budget is no more than $3 million spread over the next two years.

We have already, with the support of our shareholders over these last two years, made substantial investment of time and resources to get Skinjet where it is, and we feel that it is maturing very well. So we will continue to invest our time and resources in parallel so that there is no delay caused to what we are contemplating.

Kumar Raja (Analyst)

Okay, great. And maybe finally a question about how should we think about partnerships for Tavarellix? Are you looking at, like, you know, global, regional, or, you know, collaboration? You know, what kind of partnership are you looking for for Tavarellix? Thank you.

Raza Bokhari (Chief Executive Officer)

Kumar, all of the above is the short answer. If I can use this opportunity to remind our shareholders and recap for them and all the stakeholders that support us: we started three years ago with a localized precision immuno-oncology product in Skinjet, and we have now advanced our transformation with the Pfizer collaboration into precision oncology. So while Tavarellix is a very meaningful and important asset, on a go-forward basis we see Tavarellix’s best value for our shareholders in actively and in a concerted fashion pursuing partnering and collaborations to find the resources necessary to advance those programs.

We certainly have picked up momentum towards that and in how we have redesigned these programs following the acquisition of Tavarellix at the end of August of last year. If we would recall, the acute urinary retention relapse prevention study was a 390-patient study that we had inherited— a registrational-grade study, but a very expensive study. Through the efforts of our R&D team led by our Chief Medical Officer, we refined that design. It is now a 126-patient study and has a Study May Proceed in hand. Similarly, we now have before the FDA an advanced prostate cancer program. We inherited a dose optimization study.

We feel that should be a staged part of a registrational study. We have worked very hard to put that design before the FDA. It is now more than 30— I think we are approaching into a 45-day mark. So we hope to hear back from the FDA soon, and there will be more clarity on how the partnerships would evolve. And I also want to quickly mention that we took over CMC of Tavarellix, which we had to start from scratch, and we are manufacturing the product. It has hit some snags. Those snags were out of our control. But the progress is forward, momentum is in hand, so the product also should become available sometime in the first quarter of next year. So the hope is that while this CMC is completed and the product is ready, some of these partnerships also begin to materialize.

So we have our work cut out for ourselves, but we are very focused to make this a capital-efficient drug development progress.

Kumar Raja (Analyst)

Okay, great. Thank you.

OPERATOR

And the next question comes from Chad Yan with Maxim Group. Please go ahead.

Chad Yan (Analyst)

Hi, guys. Thanks for taking the questions, and congrats on the progress. Just as you prioritize CD228V and melanoma, what would you consider a compelling proof-of-concept signal to support broader development, and how could those maybe inform expansion into other CD228-expressing solid tumors?

Raza Bokhari (Chief Executive Officer)

Thank you, Chad, for the question and for your ongoing support. As I have described in our prepared remarks, the clinical data that we reviewed during our due diligence process— of those 88 patients that were part of the CGEN study— it was a basket study that included multiple solid tumors. And the rationale behind Pfizer’s reconstruction of the payload linker to Vedotin— which is an established payload linker, and there are other molecules that are approved and in the market— gives us the confidence that in melanoma we can reasonably see an objective response rate of more than 30%.

That is the premise that we are very excited about, the possibilities of what lies ahead. But I will also yield to Dr. Faisal Mehmud, who is overseeing this process on a day-in, day-out basis, to also chime in.

Faisal Mehmud (Chief Medical Officer)

Sure. I think you’ve covered it very well, Raza. I would just say that there’s three things which we are really focused on and excited about in this program: the target, the clinical foundation, and the development strategies. So we are in a situation where CD228 gives us a really differentiated biological approach. We have the clinical experience from the predecessor molecule rather than relying only on preclinical models, and we’re using, as Raza mentioned, an established Vedotin linker-payload platform.

We are not proposing an unfocused, expensive pan-tumor development program. We’re concentrating initially on a population where there is substantial unmet need and a compelling scientific rationale. So our ambition is clear: to demonstrate clinically meaningful responses in that immunotherapy-resistant melanoma population, and we believe a response rate exceeding 30% is a real, credible development objective based on the predecessor molecule and the predecessor experience.

At that point, within the confines of this study and subsequent studies, it can be expanded to both combination with immunotherapy and other tumor types such as squamous lung, esophageal, and head and neck cancer, which is already built into the study.

Raza Bokhari (Chief Executive Officer)

So, Chad, not to overemphasize the relevance, but we come to this program— we take the baton— with approximately 99-patient data in hand from the original CGEN study and the 11 patients in the CD228V that Pfizer had initiated after reconstructing the molecule. And so we are armed with that information. In addition, we also believe that the data readout of Bonn Biotech, the only other relevant company that we are aware of that is a Hong Kong–listed company that we believe has completed about 30-plus patients of a Phase 1 dose-escalation study, and they had provided some top-line findings sometime back in August, and their detailed readout hopefully will come out soon. But collectively, all of these pointers give us confidence that we are not starting from scratch.

This is not by any chance a very early-stage asset— still early, but nonetheless where we would be able to see progress rather quickly. Our objective is that if we have to fail, we want to fail early so we can accordingly reshape our way forward. But we remain cautiously optimistic that a melanoma study should make the difference for the patients that need it the most. But time will tell.

Chad Yan (Analyst)

Got it. Thank you. Thanks for taking the questions, Raza.

OPERATOR

This concludes our question and answer session. I would like to turn the conference back over to management for closing remarks.

Raza Bokhari (Chief Executive Officer)

Thank you, David. And thank you to everyone who participated in today’s discussions. Please allow me to summarize the highlights of our call today. Our priorities are to advance selected clinical and regulatory milestones, align organizational cost with those priorities, and pursue licensing, co-development, and other strategic opportunities for our shareholders. We continue to strive to help make the connection between our portfolio and the potential value more tangible.

We’re committed to explaining the significance of each milestone, the resources required to reach it, and the decisions it enables. The measure of our progress should be stronger clinical evidence, clearer development pathways, and transactions that support continued advancement. We remain confident in the purpose of our work and remain committed to responsible capital allocation. We have built a company with a broader scientific opportunity than when we began three years ago. The ultimate return on our investment will depend on the clinical evidence we generate, the partnerships we secure, and the discipline with which we manage future spending. Our mission is to demonstrate what that opportunity can deliver for patients and shareholders.

We look forward to keeping you informed through our news releases, presentations, and future business update calls. Thank you again for your time and continued support of Medicus Pharma.

OPERATOR

The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.

Disclaimer: This transcript is provided for informational purposes only. While we strive for accuracy, there may be errors or omissions in this automated transcription. For official company statements and financial information, please refer to the company’s SEC filings and official press releases. Corporate participants’ and analysts’ statements reflect their views as of the date of this call and are subject to change without notice.