Aytu BioPharma falls as EXXUA launch burns cash despite revenue beat
Heavy marketing investments and derivative liability losses drive $10.6M quarterly net loss, sending shares lower
Aytu BioPharma shares fell 3.3% in Monday trading after the specialty pharmaceutical company reported second-quarter fiscal 2026 results that revealed a widening net loss despite beating revenue expectations. The stock declined to $2.62 as investors expressed concern over the heavy cash burn required to launch EXXUA, the company's newly approved antidepressant.
The Denver-based company reported quarterly revenue of $15.2 million, topping analyst estimates of $12.2 million. However, earnings per share came in at a loss of $1.05, significantly worse than the expected loss of $0.50 per share. The company recorded a net loss of $10.6 million for the quarter, driven primarily by an $8.2 million derivative warrant liability loss and substantial investments in the commercial launch of EXXUA.
According to the company's SEC 8-K filing, adjusted EBITDA turned negative to $0.8 million from a positive $1.3 million in the same period last year. The swing to negative adjusted EBITDA underscores the financial pressure of bringing a new therapeutic to market in a competitive pharmaceutical landscape.
"The EXXUA launch is consuming resources at a faster rate than anticipated," said Josh Disbrow, Aytu's chairman and chief executive officer. "While we are encouraged by initial prescription trends, the upfront investments in commercial infrastructure, physician education, and patient access programs are impacting our near-term profitability."
EXXUA (gepirone hydrochloride) represents Aytu's most significant growth opportunity as the company shifts focus away from legacy products. The novel antidepressant received regulatory approval earlier this year and entered a market dominated by established treatments from larger pharmaceutical companies. Analysts view the launch as critical to Aytu's long-term prospects, given the commercial opportunity in a depression treatment market worth billions of dollars annually.
The company's legacy ADHD and pediatric product portfolios declined during the quarter as management deliberately shifted resources toward supporting the EXXUA introduction. This strategic pivot is typical for smaller biopharmaceutical companies that must allocate limited capital to their highest-priority products, but it creates near-term revenue headwinds.
Despite the challenging quarter, Aytu maintains a market capitalization of approximately $26.5 million with $2.62 per share trading well below its 52-week high of $3.07 but above its 52-week low of $0.95. The company's stock has shown significant volatility throughout the year as investors attempt to gauge the success of the EXXUA rollout.
Analysts covering Aytu have maintained a generally bullish outlook, with a consensus target price of $9.33 according to current market data. The stock carries three analyst ratings—one strong buy and two buys—with no hold or sell ratings. This optimism reflects expectations that EXXUA could eventually generate substantial revenue if the commercial launch gains momentum.
The derivative warrant liability loss that weighed heavily on the quarter's results stems from changes in the fair value of financial instruments linked to the company's stock price. Such non-cash charges are common for smaller pharmaceutical companies that have raised capital through warrants and other equity-linked securities, but they create accounting volatility that can obscure the underlying operational performance.
Looking ahead, investors will focus on key metrics for the EXXUA launch, including prescription growth rates, insurance coverage expansion, and the pace of physician adoption. The company's cash position and burn rate will also be critical factors to monitor, as additional capital raises could dilute existing shareholders if the commercial launch does not generate sufficient revenue to offset launch costs.
Aytu's fiscal year ends in June, positioning the company for several more quarters of reported results before investors get a full picture of EXXUA's commercial trajectory. With $63.7 million in trailing twelve-month revenue and a price-to-sales ratio of 0.42, the stock trades at a discount to many biotechnology peers, reflecting both the execution risk inherent in product launches and the company's smaller scale relative to major pharmaceutical competitors.