Presenting Ken d'Entremont, Medexus.
Thank you very much. I want to thank Planet MicroCap for the opportunity to present to you Medexus. Medexus is a publicly traded company on the TSX under the ticker MDP. You can find a lot of information about the company, including our forward-looking statements at medexus.com. Who is Medexus? What do we do? Medexus is a pharma company focused in rare disease orphan drug therapeutic area, where we have commercial products already in market. In fact, we have about 14 different products that deliver just shy of $100 million in U.S. revenue at this point. Strongly positive EBITDA at this point. What we do is really try and improve outcomes for patients with some really serious diseases. It is hematology, oncology, largely leukemias, where the outcomes are fatal. Very poor outcomes.
Bringing product to that particular therapeutic area really improves the lives of these patients with some devastating diseases. We have built the infrastructure, the support system for product commercialization throughout North America, both U.S. and Canada, and are looking to build the portfolio in that particular therapeutic area as we go forward. We have about 75% of our revenue today comes out of the U.S. That will likely go to more like 90% of our revenue coming out of the U.S. Management still owns a significant portion of the company. We have a really strong catalyst in a product called GRAFAPEX that we believe will grow to over $100 million on its own in the next few years. That is a very short-term growth catalyst.
As I mentioned, we have a very diversified portfolio at this time, so we have been evolving from a more specialty-based portfolio to one very much focused in hematology or heme-onc . At this stage, we get about 50% of our revenue is coming out of the area where we see is very much growth, and the rest is legacy products that produce strong cash flow to fund the investments that we are making into the heme-onc area. As I mentioned, products in both Canada and the U.S. GRAFAPEX is the driver, and I will speak to that specifically, but we have pipeline products also in a product called UM171, which is the next phase of treatment for the same patient population, and I will speak to that a little bit later. Our business model is very straightforward.
What we're doing is using the commercial infrastructure that we have built over several years to apply to products that we believe we can grow strongly. We are driving organic growth from what is a pretty stable infrastructure at this point. The teams are all built out. All of the resources are in place in order to grow these products. Our investments are in place as our revenue grows at a strong gross margin. Obviously, it creates a really good return, strong EBITDA growth as well, and I'll show you some of the details of that in a minute. We acquire our products through business development. We are out there licensing and acquiring products that fit within our portfolio for North America. That's the footprint that we want to feed. We feel that there's lots of opportunities in North America.
We're not looking to grow a global enterprise. We're very much focused on North America. Business development is how we acquire our products. Then once acquired, we may do some product development, meaning we will improve the product, either improve the label, improve the life cycle management of the product. We will make some changes to it in order to improve its commercial potential. But we don't do any drug development, so we're not taking development risk, we're taking commercial risk. If you look at who we are at this stage, as I mentioned, the commercial platform is completely built out in both U.S. and Canada. That's what's driving that $100 million of revenue that produces a positive EBITDA at this stage.
We've got a portfolio that will use that same infrastructure to have substantial growth through GRAFAPEX, and we're building a pipeline of products that will follow along in that same therapeutic area. That's what we have in place. What we're looking to target is specifically heme- onc and the treatment centers that treat a certain type of leukemia and do the transplants that cure that particular leukemia. Those are stem cell transplants that are done at about 180 different institutions across the U.S., about 17 in Canada. A very concentrated and focused market. The reason that's important is because the sales commercial footprint that we need in order to address that market is relatively small. You don't need massive sales teams in order to approach and penetrate a small group of hospitals like that.
Let's go to GRAFAPEX. GRAFAPEX is the short-term revenue driver. This is where we'll have significant uptake. GRAFAPEX is the first product and only product approved for conditioning of bone marrow prior to a stem cell transplant for AML and MDS, the two most common forms of leukemia. There are about 10,000 stem cell transplants that are done in the U.S., allo stem cell transplants that are done. That's where they would use our drug. That drug was approved in January of 2025. We launched it shortly thereafter. I'm reporting now on basically a year's worth of in-market commercial activity. During that period of time, we did about $11.5 million of revenue in that first year as we're working on the reimbursement.
The early commercialization data is really good. Obviously, we are still early in the game. We've got about 42%. Now, I think it's about half of the hospitals have already ordered the product and used the product in patients. We've got very broad reimbursement at a very good price in the U.S. We have something called an NTAP, which is a new technology add-on payment, which is basically Medicare saying they will pay for it, sorry. They will pay for it in their patient group, the difference between the old technology and our technology. That's really a strong endorsement that the largest payer in the country has said this is a really valuable therapeutic and it ought to be reimbursed. Really good reimbursement that we have in place.
We have seven years of exclusivity through the orphan drug exclusivity mechanism, and we're obviously looking on expanding that period of exclusivity. That's our lifecycle management. The drug itself, we view as $100 million-$175 million potential. That's what we've guided to. That's informed by a lot of experience that we have in Canada, market research that we've done in the U.S., and that is basically a 29%-42% market share of allo transplants. That is a number that's been achieved in every other country where this drug has been launched. It's become the standard of care where it's available. It comes in at a very strong gross margin, significantly better than our current blended portfolio, which is about a 60% gross margin. Treosulfan's about an 80% gross margin.
A very good product to have that will drive revenue growth as well as margin improvement. This is the experience we have in Canada. We launched this drug several years ago in Canada, and this is part of the information which drives our view of the uptake in the U.S. You can see once product reimbursed, which was fiscal 2024, we had this really strong uptake that got us to the type of numbers that I'm quoting for peak market share in the U.S. W e've had the experience in Canada. It's become very much a well-adopted product in Canada, and we believe the same thing will happen in the U.S.
The other piece of information that I think informs our view that this is a $100 million-$175 million product is the fact that the clinical data is extremely good. This is a clinical study, real-world evidence that we conducted at Princess Margaret Hospital here in Toronto. That's the largest transplant institution in Canada. They basically mirrored the phase III data that demonstrated a 30% improvement in overall survival. Think about that. If anyone here had friend or relative going through one of these things, that's a 30% better outcome survival at two years by using our drug versus the current therapy. Obviously really strong clinical evidence that drives good reimbursement, that drives good uptake, and informs our belief that this will be a strong participant.
What are we doing in addition to GRAFAPEX? Obviously, our first focus is drive GRAFAPEX to peak revenue. The second thing is let's build a portfolio around GRAFAPEX. This is basically the continuum of an allo transplant patient. They obviously get diagnosed and have some initial chemotherapy. They get into remission. They'll look for a cell source that they can then transplant this patient with. Without the transplant, the mortality from AML is about 90% at five years. This is a very bad outcome. A transplant is a chance at a new life, and this is clearly very desirable for the patient and the clinician.
They're looking for opportunities to transplant these patients as soon as possible. What that means is get them into remission with the chemotherapy, move them towards transplant, find a cell source, which currently is coming largely from donors, whether they're related or unrelated. They condition them with our product. Our product basically wipes out the immune system that they currently have. It's where the cancer is. Then they engraft them with the new cells and treat them, and hopefully those cells grow, create a new immune system, and then that patient has a new lease on life. There's many different points along that continuum where we can have an impact. Obviously, we have the conditioning agent. We've now licensed UM171 for Canada. That's a cell source.
We're looking at GVHD treatments. GVHD is graft versus host disease. It's almost like a rejection of the graft. We're looking at these various points that are all the same patient, same physician, same institution, which means same commercial footprint for us. This is what we're doing in our business development efforts in order to build a portfolio. That's GRAFAPEX, and we feel very bullish on that, but we also have a strong base of business. IXINITY is currently our largest product. IXINITY is a factor IX for hemophilia B. Hemophilia B is another rare disease. There's only 4,000- 5,000 people in the U.S. that have hemophilia B, about 700 in Canada. Basically, what this does is replace the factor IX that's missing from their blood.
With our drug, they can have a completely normal life. They infuse this every three or four days, and then they can go about their activities. Without their drug, they're going to have severe bleeds and could be fatal. Obviously another really important intervention. This is a biologic drug. It has patent protection out to 2028, but unlikely there'd ever be any generic substitution for a drug like this. They're extremely expensive to develop, so generics tend not to develop biosimilars for such products. There's a much larger competitor, which is BeneFix, which has been off patent for 15 years, and there's no generic to substitute that product with.
Our next biggest product after that is another mature product, Rasuvo. It's called Metoject in Canada, where we had an 80% market share in the U.S. market. Our competitor dropped out recently, and then we captured that market share, and now we're the sole product of methotrexate in an auto-injector for rheumatoid arthritis. A very, very stable product, which we believe will go on, until 2028 to 2030 sort of timeframe, where it will lose its exclusivity and generics would enter. Our financial results have been strong. You see the revenue has grown strongly, kind of plateaued while we were waiting for treosulfan to get approved by the FDA. In that interim, we lost exclusivity on a product in Canada, caused some erosion, and now it's starting to rebound back up. You can see that in the quarterly results.
In the quarter ending March 2025, that was the quarter in which we launched GRAFAPEX, so our EBITDA went to a low of $2.2 million, and has grown since that point in time. You could see that we would expect to see continued revenue and EBITDA growth as GRAFAPEX gets traction in the U.S. and drives us forward. Our balance sheet is quite clean. We have had very strong share appreciation over the past 12 months. We have got about 31 million shares outstanding. We have been actively buying back our shares. Net debt is about one time, a little bit over one time EBITDA. Obviously, net debt is very, very manageable. We have got a good credit facility that gives us some dry powder for future business development. We have got good analyst coverage.
As you are looking at the company, I think you should be thinking about a diversified portfolio of mature cash-generating products that are funding a very innovative product that will have strong revenue and margin expansion for the company into the future. That EBITDA and margin and revenue growth on GRAFAPEX is going to be happening quarter by quarter now. We are getting increased traction every quarter as we go forward. We have guided to $30 million-$32 million of net revenue for GRAFAPEX in this fiscal year, following the $11.6 million that we did last year. So very strong revenue growth, aggressive outlook, but it is informed by the type of uptake that we are getting in the market.
We have got a very strong commercial platform in those institutions, so we would expect to continue to leverage that platform on new products like UM171. We are actively pursuing other products to add to that same portfolio. As I mentioned, I think we are being undervalued in terms of our peer group. We are still relatively low in comparison on both on EV to net revenue and EV to adjusted EBITDA. Balance sheet is strong, manageable net debt with cash on hand that is growing even as we are buying back our shares. So that is the company, and I am happy to take any questions that anybody might have.
Ken, with regards to buying back shares, how many shares have you bought back, what price?
We have our CFO right here.
It is well over 1 million shares. I do not know the exact number, but it is being about 3% or 4% of our total. We started buying back in last November.
What would be the typical price you would buy back right now?
I think average price is probably somewhere around $4.50 since we are very actively buying at current prices.
Hi again. How comfortable are you with the balance sheet being able to fund your biz dev, and what are the thoughts in terms of potentially cleaning out your portfolio a little bit to help fund that growth?
Yeah, great question. We're always looking at our portfolio in terms of we're buyers as well as sellers. When it's non-strategic mature portfolio, if it's better off in someone's hands, we would certainly consider that, and that's a good source of capital to fund what we really want to do, which is grow in HCT. We do have a good credit facility, and maybe Brendon can speak to it in a little more detail. That gives us some dry powder to do business development, and that's what we used on the UM171 deal in Canada.
We have a good amount levered up, baked into the facility. It's about $25 million- $30 million already anticipated.
Maybe can I ask another one? The GRAFAPEX, the $30 million- $32 million guide, if you look at the public disclosure so far, I think, again, you haven't disclosed it specifically, but the public disclosure, according to Gilbert, you've done about a third in the first half of the fiscal year, which implies a pretty significant ramp in the next two quarters. Again, you haven't reported three, but the two quarters that we have had gone through. Just what gives you the confidence at this point, the visibility to kind of say a bit about the rest of that?
Yeah, it's a great question. The uptake is being informed by what we're seeing happen in the individual institutions and the reimbursement scenario. The reimbursement scenario is very positive. No one has been rejected. If clinician writes drug, they're going to get the drug. It's a matter of initiating the trial in the institutions to drive them to regular uptake. We're tracking each institution quite closely and saying, okay, which ones do we think are going to come on board, and which ones do we think are going to increase their revenue and uptake once they've used it? That is very much pointing towards the number, which is the $30 million-$32 million. It's an aggressive expectation, no doubt, but that's a type of uptake that we've seen in our Canadian launch. That's kind of how it played out.
With the type of information that's coming out from the marketplace, we can see that not only are we delivering on our clinical promise of better outcomes for these patients, but we're also demonstrating good economic outcomes. That data is really well informing the institutions to realize, yes, you're going to pay more for treosulfan than busulfan, but you're going to save money through less intervention. Your drug costs will be higher, but the number of interventions, the length of hospital stay, all of these things are going down. You can save substantial money as a result of making an investment in the drug product.
As that data comes out, and it will be the first presentation of the real world data will be ASH, which is sometime in early December, New Orleans. There will be two presentations on real world data using GRAFAPEX in the U.S. that will demonstrate both the clinical outcomes and the financial outcomes. We think that will be a major stimulus towards the back end of the year for us because people say, "Wow, gee, okay, their promise is actually playing out in reality.
Ken, moving forward, you were in the past very diverse. I don't think that there was any one real targeted area. Moving forward, do you want to focus on leukemia and related areas, or[crosstalk].
Yeah, you have that exactly right. Historically, it was not like we were totally diverse. We were looking at three different areas. It was allergy, it was autoimmune disease, it was heme. We have prioritized the heme area because that is our best opportunity, best opportunity for growth, best opportunity to get more portfolio products. I think the market has responded really well to that. That is certainly what a strategic buyer would be interested in, is to say, "Let us build portfolio in a really attractive therapeutic area," which is what we are doing.
Absolutely deprioritizing the more mature products. There was not as much growth potential in those anyway. Deprioritizing those, using their cash flow to grow in HSCT or stem cell transplant. I think that is the end of our time. Thank you very much for your interest. We appreciate it.