Thank you, and good morning, everyone. Welcome to Medexus Pharmaceuticals third quarter 2025 earnings call.

On the call this morning are Ken d'Entremont, Chief Executive Officer; and Brendon Buschman, Chief Financial Officer. If you have any questions after the conference call or would like further information about the company, please contact Adelaide Capital at (480) 625-5772.

I would like to remind everyone that this discussion will include forward-looking information as defined in securities laws. Actual results may differ materially from historical results or results anticipated by the forward-looking information.

In addition, this discussion will also include non-GAAP measures, such as adjusted EBITDA and adjusted EBITDA margin, which do not have any standardized meaning under IFRS and therefore, may not be comparable to similar measures presented by other companies. For more information about forward-looking information and non-GAAP measures, including reconciliations to net income and loss, please refer to the company's MD&A, which along with the financial statements are available on the company's website at www.medexus.com and on SEDAR+ at www.sedarplus.ca.

As a reminder, Medexus reports on March 31st fiscal year basis, Medexus reports financial results in U.S. dollars and all references are to U.S.

dollars unless otherwise specified. I would now like to turn the call over to Ken d'Entremont.

Thank you, Victoria, and thank you, everyone, for joining us on this call today. We've had a busy and exciting month post quarter.

We saw the successful completion of the FDA review process for GRAFAPEX and we completed a CAD30 million public offering of common shares just last week. Between the strong fiscal Q3, and the net proceeds of the offering, we believe, we are in a great position as we prepare for the launch of GRAFAPEX in the United States.

I will speak more to these developments in a few moments, but I want to quickly hit on our financial highlights from the quarter. We're pleased with the fiscal Q3 2025 results, particularly our stable revenue, positive net income, and strong adjusted EBITDA, which have allowed us to continue preparing for the launch of GRAFAPEX in the first half of calendar year 2025, meaning that we expect product to be commercially available by April 2025.

Our fiscal Q3 2025 revenue was $30 million, an increase compared to $25.2 million for the same period last year. Our fiscal Q3 2025 adjusted EBITDA was $5.8 million, an increase compared to $3.2 million for the same period last year.

We continue to produce positive net income of $0.7 million for the quarter, an improvement of $1.2 million over the same period last year, and positive operating income of $3.8 million, an increase of $2.8 million, compared to $1.6 million for the same period last year. These important metrics for fiscal Q3 continue to reflect the financial discipline initiatives we implemented last year in our operating cost and cost structure.

They also reflect around $1.9 million of fiscal Q3 2025 operating expenses in support of GRAFAPEX, which is a change from fiscal Q3 last year. Turning to our specific products.

I would first like to talk about GRAFAPEX as this product will provide a substantial uptick to our growth profile over the coming years. On January 22, we learned that the FDA had approved GRAFAPEX, which is our branded name for treosulfan for injection in the U.S.

GRAFAPEX holds Orphan Drug Designation under the Orphan Drug Act, meaning that the product will benefit from at least seven years of regulatory exclusivity in the FDA-approved indication. We hold exclusive commercial rights to GRAFAPEX in the United States under a February 2021 exclusive license agreement with our strategic partner Medac.

We are targeting a commercial launch in the first half of calendar year 2025 with product expected to be commercially available by April. We believe that annual product level revenue for GRAFAPEX has the potential to exceed $100 million within five years after commercial launch.

Given the FDA approval, we do now owe a regulatory milestone payment to our partners at Medac. The amount payable to Medac is based on the language of the product label approved by the FDA.

We have determined that Medac has earned a $15 million regulatory milestone amount and we are working with Medac to confirm that amount in light of the terms of our agreement. The milestone amount is payable in installments, so for a $15 million milestone we would pay $2.5 million by June 30, 2025, $5 million by October 1, and $7.5 million by January 1, 2026, although we have the right to temporarily defer some of these amounts.

In Canada, unit demand for Trecondyv grew by 55% over the trailing 12-month period ending December 31, 2024. This strong performance does not yet include the effects of our successful November 24 completion of negotiation process with the pan-Canadian Pharmaceutical Alliance and subsequent decisions by participating government organizations on public reimbursement of Trecondyv.

To-date, D.C., and Ontario have executed listing agreements to reimburse Trecondyv in those provinces. IXINITY unit demand in the United States decreased by 1% over the trailing 12-month period ending December 31, 2024.

We expect that unit demand will remain stable over the remainder of fiscal 2025. This performance reflects the success of our efforts to maintain existing demand despite a reduction in allocated sales force resources to IXINITY since January 2024.

Our investments in IXINITY manufacturing process improvement initiatives have greatly had a positive impact on batch yield and manufacturing costs now extending into fiscal year 2025. Gleolan unit demand in the United States grew by more than 8% over the trailing 12-month period ending December 31, 2024, as our commercialization efforts continue to result in new customers adopting the product.

We continue to discuss the future of our involvement in commercializing Gleolan in the United States with our licensing partner and will provide an update if and when warranted. Rupall unit demand in Canada increased by 18% over the trailing 12-month period ending December 31, 2024.

Rupall's market exclusivity granted by Health Canada expired in January 2025. We expect that Rupall will now begin to face generic competition in Canada and we have initiated a strategy to support the product in this context.

The Rasuvo unit demand in the United States and Metoject unit demand in Canada both remain strong during fiscal Q3 2025. Although the factors we have discussed in the past have continued to affect product level revenue.

On terbinafine hydrochloride, a nail lacquer to treat nail fungus infections, we recently received a notice of deficiency from Health Canada regarding our new drug submission for the product. The notice identified concerns and uncertainties associated with the design of the Phase 3 trial submitted to support the requested indication and the interpretation of the efficacy results.

We remain focused on building our North American allergy and dermatology franchise, but in the meantime, we have redeployed resources to support other portfolio products in this therapeutic area, including Rupall and NYDA. In sum, we continue to focus on maintaining stability in our base business and generating cash from operations as we prepare for the launch of GRAFAPEX in the United States and other potential revenue opportunities in the future.

I will now turn the call over to Brendon who will discuss our financial results in more detail. Brendon?

Thank you, Ken. This quarter, we are pleased to have generated $5.8 million of adjusted EBITDA from $30 million of revenue for an adjusted EBITDA margin over 19%.

We also generated $0.7 million of net income. These results are due to a strong quarterly performance enhanced by in-quarter customer buying patterns for IXINITY, successful execution of our targeted reductions in operating expenses, and a streamlined capital structure.

We also continue to generate meaningful cash from our operating activities with operating cash flow of $6.7 million in the quarter. Turning to the full quarterly results.

Total revenue for fiscal Q3 2025 was $30 million, which represents an increase of $4.8 million, compared to $25.2 million for the same period last year. The $4.8 million year-over-year increase was attributable in part to continuing growth in net sales of Rupall and an approximately $2 million beneficial impact of customer buying patterns of IXINITY.

Gross profit was $15.2 million for Q3 2025, compared to $12.7 million for the same period last year. Gross margin was 50.7% for Q3 2025, which is consistent with the 50.3% we achieved in the same period last year.

Selling and administrative expenses were $11 million for Q3 2025, compared to $10.7 million for the same period last year. As Ken mentioned earlier, we have begun making more significant investments in personnel and infrastructure to prepare for the commercialization of GRAFAPEX, which are reflected in SG&A expenses.

These investments totaled $1.9 million in fiscal Q3 2025 and we expect this spending to increase to approximately $4 million in fiscal Q4 2025 and stabilize at around that level quarterly thereafter. Adjusted EBITDA was $5.8 million for fiscal Q3 2025, an increase of $2.6 million compared to $3.2 million for the same period last year.

The increase in adjusted EBITDA was primarily attributable to the effects of our ongoing financial discipline efforts, together with the effects of customer buying patterns mentioned earlier and partially offset by our GRAFAPEX personnel and infrastructure investments. Net income was $0.7 million for fiscal Q3 2025, reflecting a $1.2 million increase compared to a net loss of $0.5 million for the same period last year.

This is our fourth consecutive quarter of positive net income and we look forward to striving for positive net income in the quarters to come. Cash on hand of $8.4 million at December 31, 2024, compares to $7 million at September 30, 2024, and $5.3 million at March 31, 2024.

We continue to generate cash from our operating activities with quarterly operating cash flow of $6.7 million, compared to $5.5 million for fiscal Q3 2024. As Ken previously mentioned, in January 2025, we completed a public offering of common shares for CAD30 million of aggregate gross proceeds, or CAD28.3 million of aggregate net proceeds before expenses, which in U.S.

dollars is approximately $20.9 million gross, or $19.7 million net. As of December 31, we had a combined $40.9 million outstanding under our two BMO credit facilities, consisting of $3.5 million drawn under our revolving credit facility and the remainder outstanding under our term loan facility.

As always, there can be variability in quarter-to-quarter results, but we look forward to continuing to build the company and its portfolio in the coming quarters and beyond. Operator, we will now open the call to questions.

Thank you. Good morning, Ken and Brendon.

First, congratulations. This is a high action period here.

So congrats on all your success and looking forward to the launch of GRAFAPEX. My first question is on IXINITY.

Apparently we saw some strength in IXINITY purchases this quarter. I read in the MD&A that these were partially as a result of contractual purchase agreements entered into with your largest pharmacy partners.

So I wonder if you could shed any light on, I guess, those contractual agreements and I guess, what other sources of demand you might be seeing in IXINITY specifically. Thanks.

Thanks, Michael, and yes, good question. So yes, IXINITY was significantly stronger than expectations.

The partners that we're referring to are specialty pharmacies that typically purchase this product based on what their needs are for the underlying customer demand. And it was just stronger than we had expected for that quarter.

We do expect it to kind of pull back a little bit. And so I think what the guidance that we provided historically is more in line with our expectations going forward.

Okay. All right.

That's helpful. Now, turning over to Gleolan, I wonder, if you could give further color on the status of that negotiation with the licensing partner.

What does the partner? What would the partner need to see to continue on the agreement with you guys?

And then is Medexus motivated to keep this asset and invest in sales if that was required?

Yes. I think as we previously said, neither party is satisfied with the performance of the drug, even though we put significant effort behind it, it's responded with single-digit growth as we pointed out this quarter, we saw 8% unit growth over the trailing 12 months, which is decent, but not sufficient for us to be excited about continuing to promote the product going forward.

So the team's done a really good job on what has been kind of a mature product.

Okay. So to be clear, you've put in a strong sales effort and you're seeing growth, but not meaningful enough to motivate further investment in promoting this drug.

Yes. I think that's pretty well stated.

So we are evaluating the various options with the partner and once we have something to disclose, we clearly will.

Okay. All right.

Thank you. I'll pass it on for others to ask about the terbinafine and so on.

Thank you.

Thanks for taking my questions and congratulations. You mentioned you're working to confirm the milestone amount with Medac.

Have they commented on the milestone amount or your interpretation of what you owe?

No, not at this stage. I mean, obviously we each are reviewing the agreement as it's described.

It's our view when we do that the $15 million milestone has been earned and so we're waiting for a Medac confirmation on that.

Okay. And second question, have you finalized pricing for GRAFAPEX and do you expect reimbursement for Medicare by the time you launch in April?

So we are in the process now of those reimbursement discussions. So we haven't set the price yet.

We do believe that there is a very strong cost avoidance when using our drug relative to busulfan. So we are in the midst of getting those in place, not really sure of the timing of the various payers that will come into play.

We've obviously said that we think that product will be available by April, which is a very short time frame. So some reimbursement will start to fall into place, but it's going to take a few quarters before we get everything lined up.

Okay. Thanks.

That's it for me.

Thank you, and good morning. A couple questions.

I guess, you made a couple quick comments on terbinafine. That looks like a pretty significant roadblock.

Is my interpretation of that correct, that that's a pretty big delay would be my guess.

Yes. So we're in negotiation with the partner who conducted the clinical study.

But a notice of deficiency obviously is a significant challenge. So we will see what that means for the future of the drug, I think it's clear from our perspective that we won't be investing further in the drug.

It's yet to be determined what the partner wants to do.

Okay. Fair enough.

And then, if we assume that you do that $15 million is the milestone payment, first of all, congratulations on the capital raise. I know you guys have been band aiding it for a while and that's a significant addition to your balance sheet.

Do you think the capital you have now, does that kind of get you home to where you need to be to get through all of these milestones, assuming that things move somewhat in line with your forecast?

Yes. Great question, Scott.

I'll turn it over to Brendon for that.

Yes. The short answer is yes.

With this equity raise, we've really strengthened our balance sheet. We've always been very mindful of making sure we have as much optionality and flexibility as possible.

And so with this, I feel very confident in saying, we've very adequately sort of de-risked our balance sheet and we don't see any -- we don't see ourselves in a position where we're going to have to do anything further to sort of satisfy those obligations.

Okay, that's great. That's quite an accomplishment for you all.

Another question and I don't even know kind of why I'm asking this question, but you sell product in Canada, you sell product in the U.S., these tariffs, they're not there. They were there.

They're not there. In any way, if the tariffs come back into the play, does that impact your business?

If you have things that cross-border or go back and forth, is that an issue at all?

Yes, it's a good question. Obviously, with the events of last weekend, everyone scrambled to try and figure out what the implications might be, as did we.

So Brendon's done some calculations in a worst case scenario and I'll turn it over to him just to describe what that would mean.

Yes, no, perfect. So -- and to be clear, we don't have any inventory that moves across the Canadian-U.S.

border. Our exposure would be if the tariffs were to be applied to Europe.

We do bring in a number of our products from Europe. So as a reminder, IXINITY, our largest product is manufactured in the U.S., but a number of our other large products that we sell in the U.S.

GRAFAPEX and Rasuvo are manufactured in Europe. So in that case, there would be a modest expectation of tariffs.

It would not be material, and we are very confident in our ability to kind of manage that without any sort of adverse impact on the business.

Okay, great. And then, another question, given you have GRAFAPEX approved, I think your experience with Trecondyv is more important as it may be suggestive of what we could expect in the U.S.

Could you talk about that experience and why you seem pretty optimistic based on your Canadian experience, that, that this market could be ready in the U.S. as well?

Yes. It's our view that the clinical practice patterns in the U.S.

and Canada are quite similar. So when we look at the uptake of Trecondyv treosulfan in Canada, it's been really strong, particularly in pediatrics, which makes sense because organ toxicity is an even bigger issue in that group of patients.

But it's also been quite strong in adults. And all of this is prior to having any reimbursement.

And so that bodes really well for the U.S. and that the hospitals in Canada have taken up the product and paid for it out of their existing hospital budgets because one, the outcomes are better, clearly survival is much better.

But also there's certain cost avoidance that where the hospital saves money as a result of using our drug rather than the other drug. So we think all of those things bode very well for uptake in the U.S.

and it's obviously very early going. We have the launch meeting; the Tandem Meeting is next week where it's the largest meeting of U.S.

transplanters. So we'll get a lot of feedback there.

But already we're getting inbound interest for the drug and we're working to find a way to supply prior to commercial product being available.

Okay, great. Thank you for that color.

Final question and I apologize for the many questions. Q3 -- fiscal Q3 had a lot of positive variance.

When we think to fiscal Q4, should we expect revenues to look more like the second quarter than the third quarter? Should we expect some kind of reversion to the mean?

Thank you for taking the questions.

Yes, that's a great question, Scott and we're debating that now. We think it would be conservative to consider previous quarters as more normal.

This most recent quarter, it was really strong for IXINITY and we're not quite able to put our finger on it exactly as to why we certainly see the increased uptake by some of our specialty pharmacy partners and we're trying to determine what's happening with the underlying demand. In our view, it looks like it's kind of flat.

So it doesn't justify the increase in purchasing. But we don't get to see all of the demand.

It's not 100%. It's probably more like 70% of the demand that we see.

So there could be something happening in the other segment to the positive that is driving this, but we don't yet know. So I think to be conservative, we would guide more towards previous quarters rather than Q3.

Okay, great. Thank you for taking the questions.

Thanks for taking the follow-up. You mentioned a large meeting of U.S.

transplanters and inbound interest from the U.S. I'm wondering, have you reached out to potential KOLs in the U.S.

to support the drug and work towards a plan of getting it into guidelines, or is that starting now?

Yes, it's a great question, David. So yes, if you remember, we had brought on a bunch of people at risk prior to the decision with the FDA.

So a lot of that work had already started, so yes, absolutely. We've been working with KOLs to help support the commercial launch and where we want to go.

So absolutely, that that has been happening. It's in full force now and we'll have a significant presence at the Tandem Meeting next week.

Okay, great. Thanks.

I just want to thank everybody for participating in this call. We're very pleased with the past quarter's results.

Our core portfolio continues to provide Medexus with a solid foundation as we prepare for the next phase of our growth, specifically GRAFAPEX. We look forward to the opportunities that lie ahead in fiscal 2025 and beyond.

Thank you everybody for joining the call today.