Can Acrux Sustain Growth Amid Tight Cash and High-Interest RDTI Loans?
Acrux Limited reports promising revenue growth driven by new topical generic launches in the US and secures crucial RDTI funding, marking a strategic shift under new CEO John Warmbrunn.
- John Warmbrunn appointed CEO and Managing Director in June 2025
- Launch of Dapsone 7.5% Gel and other topical generics in the US market
- June quarter profit share income rising, with August receipts expected to be higher
- Received $2.19 million in short-term loans secured against FY25 RDTI claims
- Operating cash outflows of $1.83 million with cash reserves at $0.86 million
Leadership Transition and Strategic Direction
Acrux Limited, a specialty topical pharmaceuticals developer, has ushered in a new era with the appointment of John Warmbrunn as CEO and Managing Director on 1 June 2025. Warmbrunn succeeds Michael Kotsanis, who retired after 11 years of leadership that saw the company build a robust portfolio of topical pharmaceutical products. The management team is optimistic about this leadership change as Acrux pivots from a research and development focus toward managing a growing portfolio of commercialised products.
Product Launches Fueling Revenue Growth
The company has recently launched three new generic topical products in the US, including the notable Dapsone 7.5% Gel in May 2025. This launch complements the existing Dapsone 5% Gel range, which continues to see steady sales growth. Additionally, the Nitroglycerin 0.4% Ointment, launched in December 2024, experienced a near 300% volume increase in the June quarter compared to March, capturing more than its fair share of the market. These products are beginning to generate meaningful profit share income, with payments based on licensee sales expected to increase significantly in the coming quarter.
Financial Position and Funding
Despite operating cash outflows of $1.83 million during the June quarter, Acrux secured $1.73 million in April and an additional $0.46 million in July through short-term loans from Radium Capital. These loans are secured against the company’s FY25 Research and Development Tax Incentive (RDTI) claims and represent approximately 80% of the estimated rebate. While these funds provide vital liquidity, they carry a relatively high annualised interest rate of 16%, reflecting the cost of bridging cash flow gaps during the commercialisation phase.
Outlook and Market Positioning
CEO Warmbrunn highlighted the encouraging early market traction of Acrux’s FDA-compliant topical generics, emphasizing the company’s capability to navigate complex regulatory environments. The expanding product range, including Prilocaine and Lidocaine creams and Evamist®, is expected to underpin sustainable revenue growth. Acrux is also exploring opportunities beyond the US, aiming to leverage its development expertise and commercial partnerships internationally.
Challenges and Cash Flow Management
With cash and cash equivalents standing at $0.86 million at quarter end and estimated funding to cover only half a quarter of operations, Acrux faces the challenge of managing its cash flow carefully. However, the company anticipates materially higher profit share income in the September quarter, which should alleviate near-term liquidity pressures. The management’s ability to balance R&D expenditure with incoming revenues will be critical as Acrux transitions fully into a commercial-stage enterprise.
Bottom Line?
Acrux’s shift to commercialisation gains momentum, but sustaining cash flow and scaling US market penetration remain key hurdles ahead.
Questions in the middle?
- How will Acrux manage its cash runway given current operating outflows and loan costs?
- What is the anticipated timeline and scale for profit share income from newly launched products?
- Are there plans to expand the product portfolio or enter new international markets beyond the US?