How are energy investors positioned?
Botanix Pharmaceuticals Ltd reported robust financial performance in Q4 2025, driven by the successful launch of its new product, Softra. The company saw significant growth in sales and prescriptions, with the stock showing strong momentum, gaining 9.68% in the past week. According to InvestingPro data, the company’s market capitalization stands at $218.85 million, with the stock currently trading near its 52-week range of $0.09-$0.35.
Key Takeaways
- Gross sales surged to $20.4 million, a significant increase from $4.8 million in Q3.
- The launch of Softra led to a 324% increase in prescriptions.
- Operating cash flow improved by $8.4 million, reaching $28.4 million.
- The company plans to expand its sales force to 50 representatives by fiscal 2026.
Company Performance
Botanix Pharmaceuticals demonstrated strong performance in Q4 2025, attributed largely to the successful launch of Softra, the first FDA-approved treatment for primary axillary hyperhidrosis. The company increased its gross sales significantly, reflecting its strategic focus on expanding market reach and enhancing product offerings. The rise in prescriptions and prescribers indicates growing market acceptance and penetration.
Financial Highlights
- Gross sales: $20.4 million, up from $4.8 million in Q3.
- Net revenue: $4.3 million, compared to $700,000 in Q3.
- Operating cash flow: $28.4 million, an increase of $8.4 million from the previous quarter.
- Cash and inventory: $64.9 million in cash and $27 million in inventory.
Outlook & Guidance
Looking ahead to fiscal 2026, Botanix Pharmaceuticals aims to expand its sales force and enhance its market presence. The company targets a gross to net yield of 30-40% and seeks to achieve cash flow positivity without additional capital raising. Revenue forecasts for FY2025 and FY2026 are set at $3.78 million and $42.9 million, respectively.
Executive Commentary
CEO Howie McGibbon emphasized the company’s solid foundation for future growth, stating, "We’ve created a solid foundation for future growth and a pathway to make Botanix cash flow positive." CFO Chris Lesovitz added, "With $64,900,000 in cash and over $27,000,000 in inventory, we are exceptionally well positioned for a strong start to the fiscal year 2026."
Risks and Challenges
- Market competition in the dermatology sector could impact growth.
- Potential supply chain disruptions may affect inventory levels.
- Economic downturns could reduce consumer spending on dermatological treatments.
- Regulatory changes may impact market dynamics and product approval processes.
Botanix Pharmaceuticals’ strategic initiatives, coupled with its robust financial performance in Q4 2025, position the company for continued growth in the competitive dermatology market.
Full transcript - Botanix Pharmaceuticals Ltd (BOT) Q4 2025:
Vince, Chairman, Botanics Pharmaceuticals: Chairman, joining me are chief executive officer, doctor Howie McGibbon, and our US chief financial officer, Chris Lesovitz. At the end of the presentation, we’ll be taking some questions from the audience. But given the large number of participants, and we had over 500 preregistered, and we’re getting close to that number now, we won’t be able to get to all the questions, but we’ll do the best we can to address the key issues entered into the q and a by our guests that have joined us here this morning. This presentation contains certain forward looking statements and comments about future matters. Please see our cautionary note on the forward looking statements contained in our 4C press release that was issued to the ASX this morning.
I’m now gonna turn the call over to doctor Howie McGibbon. Howie?
Howie McGibbon, Chief Executive Officer, Botanics Pharmaceuticals: Thank you, Vince, and good morning to everyone on the call. Q four fiscal twenty twenty five was the first full quarter since the commercial launch of Softra on February 1. As you’re probably aware, Softra is the first and only new chemical entity approved by the FDA to treat primary axillary hyperhidrosis, the third largest dermatology condition, only after acne and atopic derm, a condition affecting around ten million people in The United States. So this is a large and underserved market in which patients experience significant effects on their quality of life. So before turning to the results, I wanna highlight three key.
So first and foremost, the team has executed extremely well. We hired and trained 27 sales professionals with a strong track record of selling to derms evidenced by the 79 Presidents Club wins between them, which are awarded only to the top 10% of sales professionals each year. The sales team quickly generated significant demand for software in our first two quarters of launch, and we’re pleased with the performance, which is on par or better than some of the more successful dermatology companies. We optimized the SendRx fulfillment platform to ensure patients and prescribers had a positive experience with the initial delivery, insurance clearance, and refills of Softra. This resulted in a continuous gross to net improvement, a growing number of fully reimbursed prescriptions, and a refill rate well exceeding industry standards.
The prior authorization process and the steps needed to expedite payment are well understood, and the impact of high deductible season has largely been mitigated. We also published the clinical trial results for Softra for the treatment of primary axillary hyperhidrosis in the Journal of American Academy of Dermatology or JAD. This publication featured data from our two phase three clinical trials, which showed the pool analysis of the co primary endpoint, which required a two point or greater improvement on the HDSM axillary seven scale and showed significantly better results for treatment versus control. There’s much work to be done, but the team has executed very well, as I said earlier. The second point I wanna make is that demand for software is high, and this is at a time when prescriptions are becoming even more profitable.
So total prescriptions shipped in the fourth quarter increased by 324% from 3,222 in q three to 13647 in q four. Growth was driven by high promotional response rates as well as high refill rates for SofDrain. The number of unique prescribers increased a 115% from 1,075 at the end of the third quarter to 2,316 at the end of the fourth quarter. Now we believe that the growing prescriber base, the rise in prescription volume, and the strong refill rate all indicate rapid acceptance of Softra’s benefits by both physicians and patients. In q four, Softra’s gross sales reached 20,400,000.0, up from 4,800,000.0 in q three, while unaudited net revenue for botanics was 4,300,000.0 compared to 700,000.0 in q three.
The gross to net yield improved throughout the quarter as the company gained more efficiencies of scale in a growing share of prescriptions received full private payer coverage. The company exited June with a gross to net of 23%. Going forward, the goal is to reach an average gross to net of 30 to 40%, a range that’s common among the most successful US dermatology companies, and we’ll strive to, meet or exceed that. Third, we are well funded to support Softer to profitability. Outflow is going to decrease and stabilize as our net sales grow.
Operating cash flow for the quarter totaled 28,400,000.0, an $8,400,000 rise from q This increase was mainly due to $11,200,000 in inventory purchases. No further drug substance purchases will be made in the first half of fiscal year twenty twenty six. The higher expenses were partially offset by the initial significant receipts from product sales. We anticipate that cash outflow will decrease quickly next quarter while softer sales continue to gain momentum. Now finally, before turning it over to Chris, I wanna discuss the growth drivers for fiscal twenty twenty six.
Given the high promotional response from physicians to direct selling from our sales professionals, the sales force was expanded from twenty seven to thirty three, and the six new fully trained sales professionals began engaging with dermatologists at the start of q one fiscal year twenty twenty six. An additional 17 sales reps will complete training during the 2026 to start selling at the beginning of q two to physicians who have not previously seen a representative. This increase in sales staff is not expected to significantly raise cost as the company is primarily reallocating portions of its existing sales and marketing budget to what is currently the most effective channel to make botanics a profitable company. As part of the company’s ongoing investment in tools and programs to support sales, materials have been created for display in the dermatologist’s offices. These materials aim to prompt sufferers of primary axillary hyperhidrosis to inquire about their condition and learn about softener.
Medical education is an effective way to communicate the science of softener to dermatologists. The publication of our phase three data for softener and the prestigious Journal of the American Academy of Dermatology previously mentioned, as well as additional scientific data was selected for inclusion in poster exhibitions at prominent medical conferences. The fall clinical dermatology conference for PAs and MPs in May, and the American Academy of Dermatology Innovation Academy in July. Botanics has created a multicity event series to introduce both the organization and Softra to dermatologists. The first Botanic Summer of Sweat event took place in June with teams of corporate executives hosting events across The United States.
These well attended events have fostered valuable dialogues with dermatologists that allow them to share their experience with Softra to both us as well as their peers. Extremely proud of what the team has accomplished in such a short time. We’ve created a solid foundation for future growth and a pathway to make botanics cash flow positive. Now I’ll turn it over to our US CFO, Chris Lesovits, to discuss the company’s cash flow further. Over to you, Chris.
Chris Lesovitz, US Chief Financial Officer, Botanics Pharmaceuticals: Thank you, Hallie. I’d like to take a moment to reiterate the strength of our balance sheet at year end. With $64,900,000 in cash and over $27,000,000 in inventory, we are exceptionally well positioned for a strong start to the fiscal year 2026. As Howie noted, our focus remains on achieving sustainable profitability. To support this, we strategically reallocated resources to expand our sales force, which we believe is the most effective path to driving long term revenue growth.
During q four, net cash used in operating activities increased from $19,900,000 to $28,400,000 Product manufacturing increased by $7,700,000 from Q3 to Q4. We made a deliberate investment in drug substance, or API, purchases during the q four of fiscal year twenty twenty five, which means we do not anticipate needing additional API in the first half of twenty twenty six. This forward looking procurement gives us the inventory stability we need to execute on our growth objectives for the year ahead. Operating cost increased $1,700,000 from Q3 to Q4, and staff cost increased $2,300,000 which was driven by an employee option exercise tax payment of $1,600,000 which was prepaid to the company in the previous quarter by the employee. These increases were offset by $3,500,000 increase in cash receipts from the product sales from Q3 to Q4.
Financing cash inflow for the quarter was $65,600,000 The company successfully raised $40,000,000 through an institutional placement and secured a debt facility with Creos Capital. The company drew down $30,700,000 in capital, incurring transaction cost of $2,600,000 As of June 3025, the company had a strong balance sheet with $64,900,000 in cash and $15,300,000 in undrawn debt, which may be assessed upon reaching certain milestones. With stable underlying operating costs, excluding inventory purchases, and expected quarter on quarter revenue growth, the company believes it is currently well funded to reach profitability, utilizing its existing cash reserves. We’re excited about the opportunities ahead, and we’re looking forward to delivering continued growth in fiscal year twenty twenty six. Now I will turn this over to Vince for q and a.
Vince, Chairman, Botanics Pharmaceuticals: Thank you, Howie and Chris. We did get a number of questions in here. So let’s get started with the ones that we have. So there’s a, I mean, how are you gonna take this first one here? There was a few questions on what to expect for reporting in the future, And some of the questions came along the line of, how often will you communicate?
Is there a planned schedule for frequency? So, what can we expect for reporting in the future? Howie?
Howie McGibbon, Chief Executive Officer, Botanics Pharmaceuticals: Appreciate that, Vince. Thanks for the question. We’ll have a call like this, the one we had today after each four c filing, a webinar after both the half and yearly reports as well as a presentation at the AGM. So there’s at least seven scheduled. And we’ll, of course, present at conferences and roadshows throughout the year for which we’ll release information.
So at a minimum, those seven times, but, again, additional information throughout the year as as we attend conferences and as there’s an opportunity to showcase any anything that’s pertinent or or might deviate from the plan as we roll out additional tactics throughout the year. But, again, we’ll stick to those four c filings in a in a call in this format. The half yearly and yearly, we’ll we’ll certainly have live webinars where you’ll be able to ask questions at each of those events.
Vince, Chairman, Botanics Pharmaceuticals: K. This is, a follow-up question to that, Howie, and it’s around, the metrics metrics you’ll report on. So, will there be a standard format of reporting? One question came in on, the July 9 press release, noting, patients receiving full, filled prescriptions, is a metric that the company will use on an ongoing basis going forward. Do you wanna comment on, what what metrics will you report on?
Howie McGibbon, Chief Executive Officer, Botanics Pharmaceuticals: Sure, Vince. We’ll report on the key, growth drivers. So total prescriptions filled, gross revenue, net revenues, the gross to net, and cash flow by quarter. And and all of these things are are those that allow us to calculate what our net sales are gonna be, and they’re the key drivers to net sales. We’ll also provide other data like new prescribers, refill rates, and other key initiatives and milestones for the quarter, for for each of these calls.
Vince, Chairman, Botanics Pharmaceuticals: K. You know what? Chris, why don’t you take the next one here? Can you explain the cost reductions from q four to q one with the field force increase? Where’s the money coming from?
Chris Lesovitz, US Chief Financial Officer, Botanics Pharmaceuticals: So we spoke during the the script here. The main the company is primarily reallocating portions of our existing sales and marketing budgets. So we were shifting within the existing operating cost line item in a four c. So all we’re doing is just reallocating money from marketing into our Salesforce to grow the Salesforce from our 27 reps to our 50 reps. And this is this is how we reallocate those funds.
Howie McGibbon, Chief Executive Officer, Botanics Pharmaceuticals: Yeah. And let let me add to that, Chris. Yeah. And and and we’ve spoken about this before. Given the promotional response from the sales representatives, there’s an opportunity here to to expand to those physicians that we haven’t called on.
And we go back to the first week of launch where we saw physicians writing after only hearing the message one time. So so we know that they’re they’re easily activated. The those sales representatives that that have been here, those first twenty seven, they’ll shift from a a reach, to greater physicians to now trying to increase the productivity of the physicians that they’re calling on. But now we have an opportunity to activate those physicians that are not called on, and we believe that they’ll behave much in the same way, that the physicians that were called on back in February for the first time well. And we’re we’re seeing just that for those six sales professionals that started on July 1.
So this is the quickest pathway to profitability and gives us the opportunity to get there, fairly quickly.
Vince, Chairman, Botanics Pharmaceuticals: Great. Chris, another question for you here. Seem there’s a number of questions about this. So I’ll just ask the one question that gets right to the point. Will you need to raise capital again?
Chris Lesovitz, US Chief Financial Officer, Botanics Pharmaceuticals: With the 64,900,000.0 in cash we have and over the 27,000,000 in inventory that we’ve purchased over the past year, we’re well positioned, you know, from a balance sheet perspective. Operating cost outflows will decrease over the next quarter and stabilize. And with the continued strong demand of Softra, all these factors supports software getting to profitability. You know, we just gotta go out and hit those revenue numbers, and and we should be good for the next couple quarters. That’s it.
Vince, Chairman, Botanics Pharmaceuticals: Chris, Holly, this one for you. Where are the Bloomberg data coming from, and why don’t they match your numbers? That’s a a question probably that’s been asked over and over again over the last thirty years. But, could you comment on the Bloomberg data, please?
Howie McGibbon, Chief Executive Officer, Botanics Pharmaceuticals: Yeah. Sure. Thanks, Vince. So so we those are actually, Symphony data, and and Symphony Health gathers its prescription data from multiple sources, and then they project the totals. Right?
Be because they don’t have every prescription that’s out there, so they have an algorithm to get there. And though they’re typically directionally correct, there’s usually a delta between what their projections are on the actuals. That can be above or below. So, again, directional growth is is reasonable expectation from from those Symphony data. The data we report are actuals without a projection.
They come directly from our pharmacy partners. So there may be a gap from time to time. There there are things we could potentially do in the future if that gap continues, but but keep in mind that that’s something that’s always been there. And, typically, as as launch progresses and and we get further into the product life cycle, they get closer. But, also, keep in mind that those are projections, and and there’ll be a gap.
Vince, Chairman, Botanics Pharmaceuticals: K. Great. Chris, why don’t you take this one on the couple of questions here on the Trump tariffs and how do they impact us, the the big beautiful bill and his comment about the 200%, tariff on pharmaceuticals. What impact, will Botanics be experiencing from that?
Chris Lesovitz, US Chief Financial Officer, Botanics Pharmaceuticals: So we’re still going through our analysis of it, but we don’t see a material impact of the tariffs that are being announced. Our product is sourced from Japan as well as France, and they both get imported into Canada. And then the product is manufactured within Canada and then imported down to United States. So the only portion of the tariffs that will ultimately affect botanics is what gets manufactured in Canada. So as of right now, we don’t really see any material impact of this.
Vince, Chairman, Botanics Pharmaceuticals: Okay. Thank you, Chris. Howie, there was a clarification question about the 4 to $500 price per script. Can you you clarify that, that statement that was made in the past?
Howie McGibbon, Chief Executive Officer, Botanics Pharmaceuticals: You bet. So so for a fully reimbursed script, that that is indeed the case. As as you know, at launch, there are certain amount of prescriptions that while we work through the prior authorization process that that the patient, gets that are unreimbursed. And and that’s purposely done for a couple reasons. Number one, we want the patient physician to have a very good experience first time they get the product.
We want them to to have the benefits of Softra, but it also allows us to then work through their prior authorization and turn that prescription into a positive. So for simplicity, we report the gross to net at 25% for all of those prescriptions. Now that said, the gross to net is improving month over month, and we do have a target there of of 30 to 40% when when we get to steady state. So it’s it’s something that allows us to ensure that every patient that has commercial insurance has the opportunity to try software and that we have the ability then to work through, their insurance clearance to make that a profitable prescription.
Vince, Chairman, Botanics Pharmaceuticals: Thanks, Holly. I could do this, the next one here. There were actually two questions, and they both touched on, new products and, the platform. So first, the first part of that that question relative to new products, I mean, obviously, we’re always evaluating new opportunities, for the company. But right now, all focus is on, software, and increasing sales and productivity of the product.
So all our time and attention is on that right now. But that hasn’t stopped any of our business development activities on behalf of the company as we look to, to the future of what, botanics can serve. As for the platform, as noted in the presentation, how he had mentioned that the platform is fully operational right now. We’re quite pleased with, how the platform is working and the speed, in which it became a 100% efficient right from the start. So in the future, as we look to, new products, the platform will be able to support that then.
K. Holly, one question for you here, around seasonality. Anything really to expect? Any key learnings from Japan that you might be able to, share relative to that?
Howie McGibbon, Chief Executive Officer, Botanics Pharmaceuticals: You know, it’s it’s it’s interesting. Over the summer, we’re not certain whether that seasonality of treatment or seasonality that, is occurring because of their promotional efforts. Right? But but but we have seen a a minor uptick over the summer. We’ll continue to monitor that over time.
And, of course, we do have, multiple promotional programs ongoing. So so we’ll report back, and and we’ll monitor those trends trends together. I think there’s an opportunity to ensure that these patients are thinking about treating their hyperhidrosis all year round now because of their access to the product and their ability to to have it to their doorstep whenever they need it. Vince, just going back to that platform question that you answered, I think, we’ll also touch upon the fact that, you know, last last October, we we noted that we were gonna monitor both digital, and, we’re gonna monitor our Salesforce promotion to determine which gave you the quickest ROI to get to cash flow positive. Now we’re seeing success in both of these, and and we’ll continue to have the platform service those patients through through telehealth.
We didn’t anticipate such a positive activation rate or promotional response at the physician level, but we did note that this would be the time of year we would determine whether or not to add more sales reps, and and and we’re doing just that. It’s it’s it’s a function of doing it a in a very phased manner to ensure that we’re being efficient, but it also allows us to get to cash flow positive quickly. Now post that, digital opportunity is there for further growth of the product. So this is a balance, but also a balance that we’ve, pointed to last last October, to to ensure that we’re allowing the data to dictate what we’re doing with the dollars to allow us to get the cash flow positive, very quickly. And we do believe that the dollars that we have on hand, the expense stabilization, coupled with the increase in both, prescriptions and profitability, put us in a very, very positive spot with regard to getting to cash flow positive.
So it’s not our anticipation to come back to the market, prior to that given given the data that we see here today.
Vince, Chairman, Botanics Pharmaceuticals: I could take this next question. There were a couple of questions here about the CBD platform, the anti infective platform that we were working on here, just what the status of that is. So the the programs are still there. As we have mentioned in the past, once we acquired Softra, all time and attention shifted to commercializing, this asset. There were some very positive results that we saw, from both the anti infective programs and most certainly, some of the common skin disease programs such as rosacea.
So those programs are still sitting in the queue for now, but right now, every dollar is going towards, the commercialization of Softron making it a success. Howie, question here about the sales representatives. A couple of them. What led you to, bringing these reps on early in the waves that you did, and what comfort do you have around the sales momentum of Softra, to be bringing on, the expansion of the of the field force this early?
Howie McGibbon, Chief Executive Officer, Botanics Pharmaceuticals: You bet. And, you know, Vince, I’ll I’ll go back to just saying that it it’s not necessarily we’re it’s not early. This this was a planned observation of the data that we have now. Two things are in play here. First of all, because we get the data in real time, we can be nimble with regard to our response.
And we pointed out that this would be the time period we would make that decision. We’re we’re we’re doing it in a phased manner to ensure that we’re getting the, same promotional response we got from the initial ’27. Now keep this in mind. Right? Those initial ’27 were calling on naive physicians or physicians that hadn’t been called on in the past.
When they went to those offices, the activation or the ability and desire to write prescriptions and send them to SendRx, was very high, and it didn’t take, many visits. And and, frankly, in the first week, a 100 over a 100 doctors wrote wrote for the product having only heard the message once. So we we have the ability to expand upon that and take advantage of that quick activation. And that allows then the initial 27 to move toward increasing the productivity or how many prescriptions those physicians write, as we go the product. Now the new sales representatives will see that same activation rate from physicians, and they’ll get to all the physicians in their territory, at least once over the first six weeks and then begin to increase the productivity of those physicians and so on and so forth with the 17.
So it does give us a a phased approach to, consistently grow over the next year through activation and productivity. So it puts us in a very good spot, and we let the data make the decision for us. We we we did see, good response with regard to telehealth, and that’s something that will continue. But for now, in getting to cash flow positive, we we believe and the data tell us that this is the quickest way to do it. Now longer term, we we have 6,300,000 sufferers out there that are not in the physician’s office that we will get to throughout the product life cycle through telemedicine.
And we’re we’re excited about that opportunity as well. But right now, we’re focused on cash flow positive with the dollars that we have, and we believe this gets us there.
Vince, Chairman, Botanics Pharmaceuticals: Thanks, Holly. I think we have time for just one more question here. And if you don’t mind answering this, I’ll just read the question as it is. I noticed there was not much discussion regarding new patient arrivals. Why the change at this time?
Howie McGibbon, Chief Executive Officer, Botanics Pharmaceuticals: Yeah. No. Thanks, Vince. At the beginning of, any drug launch, new patient arrivals are very useful leading indicator, right, of of initial physician activation and and their responsiveness. So it tells us, you know, based on those 27 reps and and we internally, we’ll use the same thing for the six, that that just started whether whether physicians are are willing based on the message to send patients to SendRx, and and how many of them do they send.
So we saw that quickly rise. But what’s most important for us now that we have, reliable data or or prescriptions shipped, refill rates, and gross to net trends, can we focus on those metrics that allow us to understand our projected net sales? Now those those are those are those that ultimately measure a paid prescription going through the system and the dollars coming into botanics. So those are our hard metrics that we we look at now. At the beginning, before you have those trends, we we we do look at new patient arrivals.
And now we see exactly what comes through the system and how quickly they go through the system and what what the dollars, are associated with each of those prescriptions by payer. So move moving forward and certainly internally on a daily basis, we look at, prescription shift, refill rates, gross to nets, etcetera.
Vince, Chairman, Botanics Pharmaceuticals: Thanks, Holly. One, one participant did note that there was a delay in getting the quarterly activity in four c report up by the ASX, but, it, came up a few minutes after the call started. So those of you that that not have an opportunity to view it, it is visible on, ASX right now, along with the full, four c report. Thank you all for joining us here, this morning and your interest in Botanics Pharmaceuticals. Thank you and goodbye.
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