Latest / Investor Exchange / iX Biopharma's Secret Shortcut To The US Medical Market – 1H FY2026

Transcript

iX Biopharma's Secret Shortcut To The US Medical Market – 1H FY2026 · Investor Exchange

• 0:02
  Time for another Investor Exchange Podcast. Here are your hosts, Matt and Sally.
• 0:08
  You know, there is this very specific,
• 0:10
  very painful headache reserved exclusively for biotech investors.
• 0:14
  Oh, yeah. I know exactly what you mean. Right. You look at a company and the
• 0:19
  science looks like something out of a sci-fi novel. And I mean that in a good way.
• 0:23
  They're dissolving things under tongues. They're talking about cellular longevity.
• 0:27
  They're engaging with the U.S. government.
• 0:29
  But then you look at the balance sheet. And it looks like a horror movie. Exactly.
• 0:32
  It's the classic great science empty bank account problem. And you find yourself
• 0:37
  constantly asking if this is the next revolutionary pharmaceutical giant,
• 0:40
  or if it's just a cash incinerator with a really cool logo.
• 0:44
  That is the central tension of the entire industry, really.
• 0:47
  You have the dream of the pipeline versus the nightmare of the cash burn.
• 0:51
  And usually those two things don't like to get along.
• 0:54
  No, they don't. And today we are unpacking a company that is trying to tightrope
• 0:58
  walk right across that chasm.
• 1:00
  We are doing a deep dive into IX Biopharma. They are a Singapore-listed specialty
• 1:05
  pharmaceutical and nutraceutical company.
• 1:07
  That's right. And specifically, we are looking at their financial results for
• 1:11
  the six months ended December 31st, 2025.
• 1:16
  In the official docs, you'll see them call this period 1H26.
• 1:20
  First half of fiscal year 2026. And I have to say, looking at these source documents,
• 1:25
  we've got the unaudited condensed interim financial statements and their official
• 1:29
  press release right here.
• 1:30
  It really feels like a company in the middle of a massive identity shift.
• 1:35
  It's a transition period, without a doubt.
• 1:37
  Yeah. We're seeing their deep losses shrinking. There's a massive explosion
• 1:40
  in sales for one specific anti-aging product.
• 1:43
  And they have this completely new strategy for cracking the U.S.
• 1:46
  Market. Right. And the mission for
• 1:48
  this deep dive is to figure out if that transition is actually working.
• 1:51
  We need to look at the quality of those earnings, understand why one segment
• 1:54
  is up a crazy 170 percent, and evaluate if their capital light strategy for the U.S.
• 2:00
  Is actually viable or just a, you know, a buzzword to keep investors happy.
• 2:04
  So let's not waste any time.
• 2:05
  We have the interim statements right in front of us.
• 2:08
  Let's start with the headline numbers. If you had to give me the back of the
• 2:11
  knack and verdict on this half-year report, just looking at the P&L, what is it?
• 2:16
  I would call it a mixed bag, but with a very interesting silver lining.
• 2:20
  If you just look at the top line, the revenue tape, it doesn't look great.
• 2:25
  In fact, if you're a growth investor, you probably flinched. Yeah, I did.
• 2:28
  Total revenue fell by 14% to $3.18 million. Ouch.
• 2:33
  A double-digit revenue decline is never what you want to see. Yeah.
• 2:37
  Usually that is right where I stop reading and hit the sell button.
• 2:40
  What actually happened there? Well, before you panic, we have to look at where that drop came from.
• 2:44
  It really comes down to one specific segment, which is medicinal cannabis.
• 2:47
  That segment dropped by 36%.
• 2:50
  Okay, that's a huge drop. Is that a demand issue? Did people just stop buying the product?
• 2:54
  No, and that's the nuance here. It wasn't necessarily because people stopped
• 2:58
  wanting it. It was an operational bottleneck. bottleneck?
• 3:01
  Yeah, the source documents mention that their third-party customers face significant
• 3:05
  delays in securing import clearances for raw materials.
• 3:09
  Ah, the classic regulatory red tape. Precisely.
• 3:12
  IX Biopharma does manufacturing services for other companies.
• 3:16
  If those customers can't get the raw materials, the weed, essentially into the
• 3:21
  country because of permit delays, IX can't process it.
• 3:24
  And obviously, if they can't process it, they can't bill for it. Exactly.
• 3:27
  It stalled demand for their manufacturing services. So that dragged the whole
• 3:31
  top line revenue number down.
• 3:32
  But, and here's where it gets really interesting, despite selling less stuff,
• 3:37
  they lost significantly less money.
• 3:40
  Yeah, I saw that. The net loss number is kind of shocking compared to last year.
• 3:43
  It is a massive improvement.
• 3:45
  The net loss shrank by 67 percent. Wow.
• 3:48
  They went from losing $6.25 million in the same period last year to a loss of
• 3:53
  just $2.06 million this period. That is a huge swing. But help me bridge that gap.
• 3:59
  How do you cut your losses by two-thirds when your sales are actually down?
• 4:02
  That math doesn't feel intuitive at all. It's a combination of three things.
• 4:06
  And we need to be careful here because as an investor, you need to know which
• 4:11
  parts of this are sustainable and where parts are maybe a bit lucky.
• 4:14
  Okay, give me the sustainable stuff first. First is plain old cost control.
• 4:19
  They reduced their total expenses by 13 percent.
• 4:22
  They just spent less money running the business. Staff costs,
• 4:27
  administrative overhead, they tightened the belt.
• 4:29
  That is management actually managing.
• 4:32
  I like that. What is number two? Number two is gross margins.
• 4:35
  Even though they sold less, they made more profit on each dollar they did sell.
• 4:41
  Margins improved from 22% to 26%. That's a solid jump. It is.
• 4:46
  This is because of a better sales mix.
• 4:48
  Essentially, they sold more of their high-margin own brand stuff and less of
• 4:52
  the low-margin manufacturing services.
• 4:54
  Okay, so they're becoming more efficient operationally. But you mentioned a lucky factor.
• 4:58
  Yes, and this is the one to really watch. It's called Foreign Exchange or FX
• 5:02
  Games. The currency markets. Right.
• 5:04
  IX Biopharma has significant operations in Australia, so they are exposed to
• 5:09
  the Australian dollar versus the Singapore dollar.
• 5:12
  Last year, currency fluctuations cost them a $2.6 million loss.
• 5:17
  That is a heavy hit just for being in the wrong currency at the wrong time. It really is.
• 5:22
  But this year, the currency swung in their favor and they booked a $1.28 million gain.
• 5:28
  Wait, so that's nearly a $4 million swing just based on currency exchange rates. Exactly.
• 5:34
  It accounts for a large chunk of that bottom line improvement.
• 5:37
  So while the operational efficiency is real, a good portion of that 67 percent
• 5:41
  improvement is simply the Australian dollar strengthening.
• 5:45
  It's a non-cash gain, essentially. That is a crucial distinction.
• 5:48
  It's great for the balance sheet right now. It looks nice on paper,
• 5:50
  but you can't exactly build a long term business strategy on hoping the forex
• 5:55
  gods smile on you every single year. Correct.
• 5:57
  You want to see actual operational growth. And that brings us to the part of
• 6:00
  the report that I think is the real headline here. The star performer.
• 6:03
  The nutraceutical segment. Yes.
• 6:05
  While the cannabis side was struggling with permits and red tape,
• 6:08
  the nutraceuticals business absolutely exploded.
• 6:12
  Revenue there hit $0.94 million, which is a 170% increase compared to the previous year.
• 6:20
  170% growth is wild. And looking at the report, it seems like this wasn't just
• 6:25
  a general lift across all their products. It was driven by one specific thing.
• 6:29
  It was. The product is called SLNAD Plus Warn.
• 6:33
  Okay, for those of us who skip biochemistry class, let's unpack that.
• 6:36
  What exactly is SLNAD Plus Warn? NAD plus is a coenzyme found in all living
• 6:41
  cells. It is central to metabolism.
• 6:44
  Think of it as the battery fluid for your cells. As you age,
• 6:48
  your NAD plus levels drop, which is why you get tired, your cells don't repair
• 6:51
  as well, and you generally just feel older.
• 6:53
  So the biohacking and longevity crowd must love this stuff. Oh,
• 6:56
  they are obsessed with it. But IX has a specific version, which is the SL NAD plus 1.
• 7:00
  The SL stands for sublingual. It's a wafer based on their proprietary technology
• 7:05
  that dissolves right under your tongue. Why does that matter?
• 7:07
  Why not just swallow a pill like a normal vitamin?
• 7:10
  Absorption. The argument is that if you swallow an NAD plus pill,
• 7:15
  your stomach acid destroys a lot of it before it ever gets to your bloodstream.
• 7:20
  But the wafer dissolves under the tongue and enters the system directly,
• 7:24
  completely bypassing the stomach.
• 7:26
  Okay, so the tech makes sense. Yeah. But why did sales explode right now?
• 7:30
  Did they just run a really good Facebook ad campaign or something?
• 7:33
  No, and this is a fascinating lesson in modern pharmaceutical marketing.
• 7:37
  It wasn't an ad at all. It was a podcast.
• 7:40
  Really? There was a very specific catalyst. The company's scientific advisor, Dr.
• 7:44
  Brian Kennedy, who is a heavy hitter in the aging field, appeared on a podcast
• 7:49
  called The Drive, hosted by Dr.
• 7:51
  Peter Attia. Oh, I know that one. Peter Attia is huge.
• 7:54
  He talks about saunas, everyone buys a sauna. He talks about protein,
• 7:57
  everyone buys steak. Exactly. It is high-level influencer marketing.
• 8:01
  Dr. Kennedy advocated for the product on that show, provided the scientific
• 8:04
  context, and gave his personal testimony.
• 8:07
  That single podcast appearance essentially spiked consumer awareness in the
• 8:11
  U.S. overnight. That is incredible leverage.
• 8:14
  It is. The source documents explicitly link that 170% revenue surge to the awareness
• 8:19
  generated by that appearance.
• 8:21
  In fact, that single product, SLN80 plus A, accounted for over 80% of all the
• 8:27
  new nutraceutical sales.
• 8:29
  It really validates that people actually want the product if they just know it exists.
• 8:34
  And I noticed in the report they were actually changing their branding strategy
• 8:37
  because of this, right? Yes.
• 8:39
  Previously, they were selling under the brand name Entity, but now they are rebranding to WaferX.
• 8:45
  Which makes total sense. WaferX is the name of their technology,
• 8:48
  the wafer delivery system itself.
• 8:49
  Right. They want to consolidate their brand equator. If the magic is the wafer
• 8:53
  delivery system, make that the brand.
• 8:55
  They are positioning WaferX as
• 8:57
  their flagship longevity brand as they push further into the U.S. market.
• 9:01
  It's a really smart move to clear up any consumer confusion.
• 9:04
  So we have a struggling cannabis segment, but a booming anti-aging segment.
• 9:09
  Now, I want to talk about how they are actually keeping the lights on.
• 9:11
  We mentioned cost control earlier.
• 9:13
  Where exactly did they cut? The biggest cut was in research and development.
• 9:17
  R&D expenses dropped by 51%, saving them about $0.42 million.
• 9:22
  Now play devil's advocate for me again.
• 9:25
  For a biotech company, isn't cutting R&D usually a massive red flag?
• 9:30
  Like, are they giving up on innovation?
• 9:32
  It feels a bit like an airline cutting maintenance costs.
• 9:36
  In some cases, yes, that would be a red flag. But you have to look at the context provided in the report.
• 9:41
  They state clearly that they have completed their key animal studies.
• 9:44
  They aren't cutting R&D because they are out of ideas. They are cutting it because
• 9:48
  they are shifting phases.
• 9:49
  Shifting from inventing to selling. Exactly. They have a portfolio of 22 products
• 9:54
  already developed and ready for compounding.
• 9:56
  The focus now is on commercializing what they have rather than spending millions
• 10:00
  developing new things from scratch.
• 10:02
  It is a pivot from pure development to commercial execution.
• 10:06
  That actually sounds like a mature decision for a company this size.
• 10:09
  You can research yourself right into bankruptcy if you never actually sell anything.
• 10:13
  Precisely. And speaking of bankruptcy or avoiding it, let's talk about the cash position.
• 10:18
  Because looking at the start of the period versus the end, it is literally like
• 10:22
  night and day. It really is a famine-to-feast situation.
• 10:25
  In June 2025, they were sitting on just $0.87 million in cash.
• 10:31
  That is dangerously low for a listed company. That is, check the couch cushions
• 10:35
  low, one bad month and you are insolvent.
• 10:38
  But by December 2025, that cash pile jumped to $5.77 million.
• 10:45
  Now, we know they didn't make that money from selling wafers.
• 10:48
  Because they're still technically loss-making. So where did the cash come from? Financing activities.
• 10:53
  They raised a net $6.84 million.
• 10:56
  This came primarily from a private placement of shares and the exercise of warrants.
• 11:00
  So they went to investors, said, we have a plan, and the investors gave them cash. Correct.
• 11:04
  And that injection restored their working capital. They went from a negative
• 11:08
  position to a positive working capital of $0.43 million.
• 11:12
  This gives them a runway. They aren't staring at the cliff edge anymore,
• 11:15
  which allows them to actually execute this U.S.
• 11:18
  Strategy they keep talking about. Which brings us to the most strategic part
• 11:21
  of this deep dive, the U.S. pivot.
• 11:23
  They keep using this phrase capital light. What does that mean in this context?
• 11:28
  This is the core of the investment thesis now. Usually, if a foreign pharma
• 11:33
  company wants to manufacture and sell drugs in the U.S., the barrier to entry
• 11:37
  is absolutely enormous.
• 11:39
  What does that usually look like? Well, you have to spend tens of millions of
• 11:41
  dollars building an FDA-approved factory.
• 11:44
  Then you have to get the FDA to inspect it. Then you have to file a new drug
• 11:48
  application for your specific pill.
• 11:50
  It takes five to seven years and costs an absolute fortune before you sell a
• 11:55
  single dollar of product.
• 11:57
  And IX Bioformer is basically saying, no thanks, we're not doing that. Exactly.
• 12:01
  Instead, they found a side door. They signed a joint venture term sheet in November
• 12:06
  2025 with a company called Orion Specialty Labs.
• 12:10
  Who are they? Orion operates what are called an FDA-registered 503B compounding
• 12:15
  facility in the U.S. Okay, 503B compounding facility.
• 12:18
  I see that term all over the report. Let's unpack that jargon. Why does that matter?
• 12:22
  Think of it like this. Big Pharma is like a massive factory making millions of identical suits.
• 12:27
  A 503B facility is like a licensed custom tailor. Custom tailor. Yes.
• 12:33
  The FDA allows 503B facilities to manufacture large batches of custom-formulated
• 12:39
  drugs for hospitals and clinics without getting a separate FDA product approval
• 12:43
  for every single formulation.
• 12:45
  They exist to fill gaps. So maybe a hospital needs a specific dosage that isn't
• 12:50
  commercially available, or a patient can't swallow pills and needs a liquid or a wafer.
• 12:55
  I see where this is going. Because Orion already has the license and the facility.
• 13:00
  IX BioPharma can take their waferics technology, these sublingual wafers,
• 13:04
  and use Orion to manufacture and sell them in the U.S.
• 13:07
  Right now. They don't need to build the factory.
• 13:09
  They don't need the five-year wait for an NDA approval.
• 13:12
  That is the capital light model. They skip the construction and the regulatory
• 13:15
  waiting room completely.
• 13:16
  Exactly. It leverages Orion's existing infrastructure. It is faster.
• 13:19
  It is cheaper. And it gets them into a market, the compounding market,
• 13:23
  that is projected to reach $10.7 billion by 2033.
• 13:27
  So they are essentially becoming a technology provider to the compounding industry.
• 13:31
  Like Intel Inside for custom drugs. Yes.
• 13:35
  They are betting that the wafer format, which dissolves fast and absorbs better,
• 13:40
  is a superior delivery method for all sorts of drugs.
• 13:43
  And they aren't just talking about vitamins here. They are looking at serious
• 13:47
  pharmaceuticals. Like what? Weight loss drugs, for example.
• 13:50
  Hormones. Pain medication. Speaking of pain medication, there is one specific
• 13:55
  drug mentioned in the report that seems like a bit of a wild card.
• 13:58
  WaferMine. This is their ketamine product for pain, right? That's the one.
• 14:02
  And this is potentially huge, though still uncertain.
• 14:05
  WaferMine is their sublingual ketamine wafer. It has successfully completed
• 14:09
  phase 2B clinical trials.
• 14:11
  It's a non-opioid painkiller, which, given the opioid crisis in the U.S.,
• 14:16
  is highly relevant right now. And what is the update on it in this report?
• 14:20
  The report states that IX has been invited by a leading U.S.
• 14:23
  Government agency to bid for supplying WaferMine for acute pain management.
• 14:28
  Invited to bid by the U.S. government. They don't name the agency.
• 14:31
  They don't, but you can use your imagination.
• 14:34
  Department of Defense, maybe? Veterans Affairs?
• 14:37
  The U.S. government is desperate for effective pain management that doesn't
• 14:40
  get soldiers or patients addicted to opioids.
• 14:43
  That is not a small thing at all. No, it is a very strong signal.
• 14:46
  It implies institutional interest.
• 14:48
  And the key insight here for investors is that if this collaboration goes through,
• 14:53
  it could provide non-dilutive funding.
• 14:56
  Meaning the government pays for the development, not the shareholders. Exactly.
• 14:59
  It validates the science in a way that regular marketing never could.
• 15:03
  It's a potential game changer if they win that bid.
• 15:07
  So we have a lot of optimism here. We have the nutraceuticals booming thanks
• 15:11
  to Peter Adia. We have the cash refill from investors.
• 15:14
  And we have this clever backdoor into the U.S. market via compounding.
• 15:19
  But I am looking at the cash flow statement again. We need a reality check.
• 15:23
  We definitely do. Let's not get carried away with the potential just yet.
• 15:26
  Despite all the good news, the company is still loss-making.
• 15:29
  And more importantly, their operating cash flow was negative $1.94 million.
• 15:35
  That is the sobering reality. The $5.77 million cash pile they have now,
• 15:42
  that's from selling shares. It is not from profits.
• 15:44
  The day-to-day business of selling wafers and manufacturing cannabis is still
• 15:49
  burning more cash than it brings in.
• 15:51
  Meaning every day they open the doors, money leaves the building. Exactly.
• 15:55
  They are burning cash to keep the lights on.
• 15:58
  That runway they built with the financing won't last forever.
• 16:01
  They need the revenue to catch up to their expenses before that cash runs out.
• 16:06
  And the report also flags some global headwinds. Yes. They specifically mention
• 16:10
  geopolitical tensions and tariff uncertainty.
• 16:12
  Since they manufacture in Australia and ship globally, including to the U.S.
• 16:16
  And China, tariffs or supply chain disruptions could seriously hurt them.
• 16:20
  We already saw how import delays crush their cannabis revenue this half.
• 16:23
  That could easily happen again. It absolutely could. And then there is the execution risk.
• 16:28
  The pivot to the U.S. and the Orion joint venture looks brilliant on paper.
• 16:32
  It makes complete strategic sense.
• 16:34
  But signing a term sheet is the easy part.
• 16:37
  Actually integrating the tech, producing the batches, and selling them to U.S.
• 16:41
  Hospitals, That is hard work.
• 16:43
  They haven't actually started churning out millions of dollars of product from
• 16:46
  that partnership yet. No, they haven't. And that is the critical risk.
• 16:49
  If the U.S. expansion is slower than expected and the cash burn continues at
• 16:53
  this rate, they could find themselves back in a really tight spot in 12 to 18 months.
• 16:58
  So it really is a race against the clock.
• 17:00
  Can the new strategy pay off before the new money runs out? That is the classic
• 17:05
  biotech story, isn't it?
• 17:06
  But at least now, compared to six months ago, they have a fighting chance.
• 17:10
  They have the cash, they have the product validation from the podcast,
• 17:13
  and they have the partnership lined up.
• 17:15
  It definitely feels like they have cleared the immediate danger zone of insolvency
• 17:19
  and are now in the prove-it zone.
• 17:22
  Agreed. They have swapped an immediate crisis for a strategic challenge.
• 17:25
  The next two reporting periods will be absolutely critical to see if that compounding
• 17:29
  strategy translates into actual dollars on the top line.
• 17:33
  So let's wrap this up. We've looked at IX Biopharma's 1H26 results.
• 17:38
  We saw a company that is fixing its balance sheet, cutting R&D spend to focus
• 17:43
  on sales, and betting big on U.S.
• 17:46
  Compounding pharmacies and anti-aging wafers. A company in transition,
• 17:50
  moving from development to commercialization.
• 17:52
  And here is the provocative thought I want to leave you with today.
• 17:56
  We saw how one podcast appearance spiked their nutraceutical sales by 170 percent.
• 18:02
  It shows the product works and people want it. But can a company rely on viral
• 18:06
  moments and capital-like partnerships to build a sustainable pharmaceutical giant?
• 18:11
  Or is this explosive growth in wafers just buying time for a pharma strategy
• 18:16
  that might take years to mature?
• 18:18
  That is the multi-million dollar question. Something to think about.
• 18:21
  Thanks for joining us on this deep dive into iX Biopharma. Pleasure to be here.
• 18:25
  And before we go, we need to remind you, this content is intended to serve strictly
• 18:29
  and only as an informational, independent, objective summary of recent events
• 18:33
  and should in no way be interpreted,
• 18:36
  construed or relied upon by any party as inside information or financial advice.