Can Mayne Pharma’s Women’s Health Surge Offset Dermatology Challenges?

Mixed Financial Performance Amid Growth in Core Segments

Mayne Pharma Group Limited (ASX – MYX) has delivered a nuanced trading update for the first five months of fiscal year 2026, reflecting both promising growth and operational challenges. The company’s Women’s Health division continues to drive volume growth, with total prescriptions rising 15% compared to the prior corresponding period. Key brands such as NEXTSTELLIS, BIJUVA, ANNOVERA, and IMVEXXY have all posted prescription gains, underscoring sustained demand in the menopause and contraceptive markets.

Conversely, the Dermatology segment experienced a 12% decline in revenue, primarily due to price compression and increased competition following coverage losses on RHOFADE. However, this was partially offset by the successful launch of TWYNEO and EPSOLAY, which boosted gross margins significantly to 64% from 52% year-on-year in US dollars, reflecting a beneficial shift towards higher-margin branded products.

Strategic Investments and Financial Position

Despite solid volume growth, Mayne Pharma’s group total direct contribution fell 7.3% to $49.7 million, impacted by increased marketing and selling expenses, particularly in Women’s Health and International segments. The International business saw a 38% decline in contribution, even as gross margins improved following the Pharmaceutical Benefits Scheme (PBS) listing of NEXTSTELLIS in Australia. Net revenues decreased by 5.5% to $165 million, while underlying EBITDA halved to $11.5 million, reflecting higher spend on FDA-mandated post-approval studies and other operational costs.

The company maintains a robust cash position of $83 million as of November 30, 2025, after completing the acquisition of TWYNEO and EPSOLAY rights and covering legal expenses related to ongoing litigation and corporate restructuring. This liquidity provides a buffer as Mayne Pharma navigates a period of significant corporate activity and strategic reassessment.

Regulatory Milestones and Market Outlook

Recent regulatory developments have been positive for Mayne Pharma’s portfolio. The PBS approval for NEXTSTELLIS in Australia and the US FDA’s intent to remove black box warnings from hormone replacement therapies, including BIJUVA and IMVEXXY, could enhance market access and patient confidence. Additionally, direct-to-patient sales through Adelaide Apothecary surged 50%, signaling growing consumer engagement.

Looking ahead, the company expects continued volume growth in Women’s Health and International segments, with Dermatology benefiting from the full-year contribution of TWYNEO and EPSOLAY. Mayne Pharma also announced the expansion of its Salisbury manufacturing facility, supported by a federal grant, which may improve production capacity and operational efficiency.

Strategic Review and Litigation Risks

CEO Shawn Patrick O’Brien highlighted the company’s ongoing strategic review aimed at maximising long-term shareholder value amid recent corporate developments. The Board remains vigilant on litigation matters, particularly concerning the Cosette Scheme and related parties Hamilton Lane and Avista, with Mayne Pharma reserving all rights to enforce cost orders and pursue claims.

This period of transition and investment underscores the company’s commitment to its core franchises while managing external risks and market pressures.