Fennec Pharmaceuticals' Earnings Calls Clash on Revenue Guidance and Operating Expense Trajectory

Date of Call: Mar 24, 2026

Financials Results

• Revenue: Q4: $13.8M, up 75% YOY. Full year: $44.6M, up 50% YOY.

Guidance:

• Cash operating expenses for 2026 estimated to grow from ~$35M in 2025 to ~$50M in 2026.
• Expect positive cash flow from operations in Q1 2026.
• Gross-to-net drop-down expected to be ~85% of gross sales, COGS in mid-single digits.
• Anticipate material contribution from Norgine partnership in second half of 2026.
• Expansion of commercial team expected to contribute materially starting in second half of 2026.
• No other outstanding litigation; Cipla generic settlement provides market exclusivity until 2033.

Business Commentary:

Record Product Sales and Market Growth:

• Fennec Pharmaceuticals reported record net product sales of $44.6 million for 2025, compared to $29.6 million in 2024, representing an increase of approximately 50%.
• The growth was driven by quarter-over-quarter expansion in active patients and new and existing accounts, demonstrating the durability and demand for PEDMARK.

Commercial Team Expansion and Sales Performance:

• In Q4 2025, Fennec's net product sales were $13.8 million, compared to $7.9 million in Q4 2024, a 75% increase.
• The company expanded its customer-facing team and outreach, particularly in the adolescent and young adult (AYA) market, to achieve greater reach and frequency with customers.

Financial Health and Strategic Investments:

• Fennec strengthened its financial health by raising over $42 million in net proceeds from public offerings, leading to the full redemption of debt, resulting in zero debt outstanding.
• The company focused on disciplined operating decisions and efficiency measures, enhancing operating leverage as the business scaled.

Progress in Clinical Evidence and Medical Strategy:

• Significant progress was made in advancing clinical evidence, with new data supporting PEDMARK's potential use in adults with head and neck cancers and ongoing studies with institutions like City of Hope and Tampa General Hospital.
• The expansion of the medical team and engagement with key opinion leaders have strengthened the independent data foundation supporting PEDMARK.

Fennec HEARS Program Success:

• The Fennec HEARS patient support program achieved record performance, with all-time highs in patient enrollments, prescribed and infused vials, and conversion rates, which increased 70% in Q4 compared to 50% in Q1.
• The program's success reflects strong patient need and the exceptional execution of the field organization in ensuring access and continuity of care.

Sentiment Analysis:

Overall Tone: Positive

• CEO calls 2025 'a transformational year' with 'record net product sales.' Describes momentum as 'continued' and states the company is 'well-positioned to continue driving clinical confidence and impact.' Announces 'strongest balance sheet in the history of Fennec' and cites 'record performance' and 'substantial progress' across commercial and medical fronts.

Q&A:

• Question from David Amsellem (Piper Sandler): We wanted to dive more into the germ cell tumor and testicular cancer group of patients. Can you maybe refresh us on what you are seeing in the field from advocacy groups and the new field force, and how is penetration in this segment? Then also, are you seeing strong uptake in academic centers or community oncology practices or both? What’s the mix between pediatric patients and older segments at present?
  Response: Germ cell tumors are the largest opportunity; advocacy group partnerships and a two-pronged physician/patient education approach are key. Seeing substantial interest from both academic and community settings, driven by deep medical team engagement and mechanistic discussions, leading to increased KOL interest and enthusiasm.

• Question from Madison El-Saadi (B. Riley Securities): Maybe if we could double-click on the growth of the number of treated patients in 4Q. Making certain assumptions about pediatric revenue, it looks like the AYA patient treated count rose materially in 4Q, at least by, say, 20% versus 3Q. Is that a fair assessment? Do you expect the slope to increase in the coming quarters? Relatedly, are you seeing an increase in high-frequency prescribers?
  Response: The focus is shifting towards the larger AYA market, where significant growth is seen. Expect this trend to continue. Growth is a mix of existing and new accounts, with existing accounts showing growth in both patients and vials administered.

• Question from Raghuram Selvaraju (H.C. Wainwright): The first question is from an international commercial perspective, and there are two parts. First, when would you expect during 2026 to start to see initial revenue coming from the Norgine partnership? And with respect to Japan, can you comment on when you would anticipate having a potential partner or local regional distributor in place, and how that might relate to the timeline for potential approval and market entry? And then lastly, I was wondering if you could comment on the current overall situation vis-a-vis generic filers in the wake of the Cipla settlement.
  Response: Norgine: Material revenue contribution expected in second half of 2026. Japan: Actively seeking a partner to kick off regulatory process; positive dialogue with investigators. Generic situation: Cipla settlement resolved with no other outstanding litigation; market exclusivity until 2033.

• Question from Chase Knickerbocker (Craig-Hallum): I wanted to get your thoughts maybe, you know, I think it would be helpful, you know, kinda however you guys kinda break it out internally, but, potentially a number of, kinda unique AYA accounts or prescribers. Then you kinda mentioned those accounts that are, writing more vials, in Q4 over Q3. Maybe just, you know, is that the exception? Is that the rule? Kinda, you know, maybe kind of elucidate that further as far as kinda how many repeat prescribers you’re seeing in that AYA population.
  Response: Seeing prescribers using the product multiple times due to comfort with regimen and high reimbursement rates (~95%-100% from top plans). Commercial team expansion aims to reach more customers; growth is balanced between new and existing accounts.

• Question from Chase Knickerbocker (Craig-Hallum): Maybe just being most of the way through Q1 here, you kinda called out that, you know, kind of per patient revenue is pretty significant. That does introduce a little bit of lumpiness, right? If we go into Q1 most of the way through the quarter, I think it’d be helpful just to get some kind of goalpost or thoughts as far as kinda current trends. I mean, you grew about 11% sequentially in Q4. Maybe just a goalpost there would be, do you expect that to, you know, accelerate in Q1, or is there some seasonality in Q1 that we should be thinking about for the business?
  Response: Strong momentum into 2026; commercial hires and medical hires will materially impact financials starting in Q3 2026, though growth will not slow in Q1 and Q2.

• Question from Sudhanva Nathan (Stephens): My first question, just to ask, how are you thinking about the business development going forward, particularly in terms of priorities and maybe potential areas of focus? The second one I have kind of touched on this a little bit on the prepared questions, but, you know, can you elaborate on how institutional-led research is expected to impact Fennec’s in both the near and long-term here and over the long-term?
  Response: Primary focus remains PEDMARK opportunity; partnerships with academic institutions (e.g., City of Hope, TGH) drive new data and define regulatory/labeling strategy for expansion into new populations, supporting future guideline inclusion.

Contradiction Point 1

Growth Expectations and Financial Visibility

Contradiction on providing financial guidance and visibility into revenue/EBITDA.

Robert Andrade (CFO), what were the key financial results for the quarter? - Robert Andrade (CFO)

2025Q4: The company intends to evaluate providing revenue and EBITDA guidance as the year progresses. - Robert Andrade(CFO)

"When will you issue revenue or EBITDA guidance in 2026?" - Eduardo (on behalf of Ram Selvaraju, H.C. Wainwright)

2025Q2: Updates on milestones (aggregate sales and German pricing) will be provided in future quarters. - Robert Andrade(CFO)

Contradiction Point 2

Operating Expense Outlook

Contradiction on cash operating expense trajectory for the year.

What are the key financial takeaways from Robert Andrade's earnings call? - Robert Andrade (CFO)

2025Q4: Anticipated to grow from ~$35 million in 2025 to ~$50 million in 2026. - Robert Andrade(CFO)

Can you provide an estimate of cash operating expenses for 2026 compared to 2025, considering the upcoming commercial expansion and awareness initiatives? - Sudan Loganathan (Stephens)

2025Q2: Cash operating expenses were ~$20M in the first half and are expected to decrease in the second half. - Robert Andrade(CFO)

Contradiction Point 3

Norgine Partnership Financial Contribution Timeline

Contradiction on when material revenue from the European launch partnership is expected.

Robert Andrade (CFO), can you comment on the earnings results? - Robert Andrade (CFO)

2025Q4: Expect material financial contribution in the second half of 2026 following launches in Germany and other countries. - Jeff Hackman(CEO)

Can you provide an update on the Norgine partnership and progress outside the U.S.? - Chase Knickerbocker (Craig Hallum)

2025Q1: The Norgine launch in the UK and Germany is early but positive... Milestones include official pricing in Germany and first-year sales targets, with updates expected by year-end. - Robert Andrade(CFO)

Contradiction Point 4

Status of Pending Generic Litigation

Contradiction on whether litigation with generic filers is still pending.

Raghuram Selvaraju from H.C. Wainwright, do you have any questions? - Raghuram Selvaraju, H.C. Wainwright

2025Q4: The settlement with Cipla is a major milestone, resolving the only outstanding litigation. No other litigation is currently pending. - Jeff Hackman(CEO)

Could you comment on the impact of the Cipla settlement on generic filers, including remaining litigation and expected number of other generic filers? - Raghuram Selvaraju (H.C. Wainwright)

2025Q1: What is the updated thinking on ex-U.S. territories, and what is the expected cadence of new country launches for PEDMARQSI in Europe beyond Germany and the UK? - Raghuram Selvaraju (H.C. Wainwright)

Contradiction Point 5

Financial Guidance Specificity

Contradiction on providing specific financial guidance (revenue/EBITDA) versus general outlook.

Can you provide an overview of the financial results for the quarter? - Robert Andrade (CFO)

2025Q4: The company intends to evaluate providing revenue and EBITDA guidance as the year progresses. - Robert Andrade(CFO)

"When will revenue or EBITDA guidance be provided in 2026?" - Chase Knickerbocker (Craig-Hallum)

2024Q4: The outlook for 2025 involves continued execution of strategic priorities and managing operational and financial challenges. - Robert Andrade(CFO), Jeff Hackman(CEO)