MediWound (MDWD) Q2 2026 earnings call transcript

Thank you, Chloe, and welcome, everyone. Earlier today, pre-market open, MediWound issued a press release announcing financial results for the second quarter and the June 30th, 2026. You may access this press release on the company's website under the Investor tab. I would ask you to review the full text of our forward-looking statements within this morning press release. Before we begin, I would like to remind everyone that statements made during this call, including the Q&A session, relating to MediWound's expected future performance, future business prospects, or future events or plans, our forward-looking statements, as defined under the Private Securities Litigation Reform Act of 1995. These statements may involve risks and uncertainties that could cause actual results to differ materially from expectations and are described more fully in our filings with the SEC.

In addition, all forward-looking statements represent our views only as of today, and MediWound assumes no obligation to update or supplement any forward-looking statements, whether as a result of new information, future events, or otherwise. This conference call is property of MediWound, and any recording or rebroadcast is expressly prohibited without the written consent of MediWound. With us today are Ofer Gounen, Chief Executive Officer of MediWound, Fanny Luxenberg, Chief Financial Officer, and Barry Walshenson, Executive Vice President of Strategy and Corporate Development.

Following our prepared remarks, we will open the call for Q&A. Now, I would like to turn the call over to Ofer Gonen, Chief Executive Officer of MediWound. Ofer?

Thank you, Gaia, and good morning, everyone. During the second quarter, we made meaningful progress against our strategic priorities, advancing SCRx and expanding the commercial and the development opportunities for NexoBrit. Specifically, the SCRx Global Phase 3 Value Trial is actively enrolling patients as our assessment of its addressable market continued to grow.

For Nexobrid, Vericell reported its strongest quarter since launch, and we entered into a new master service agreement with Vericell following its PADA contract.

Now let's start with an update on S-Corex. The value study remains our top priority and our key long-term value driver. Our focus is on execution, with enrollment ongoing, targeting the 216 patients across approximately 40 sites in the United States, Europe, and Israel. As the study progresses, we are approaching two key milestones.

First, the pre-specified interim sample size reassessment, and the second, completion of enrollment, both expected by the end of the first quarter of 2027. At the same time, we continue to build the broader commercial opportunity for Rescorrex. During this quarter, an independent global consulting firm completed an updated U. S. market assessment. Following the expansion of the analysis into include pressure ulcer, this updated assessment now estimates the U. S. annual peak sales at $1.05 billion. This analysis further strengthened our view that SCRX, across multiple chronic wound indications, has the potential to address a substantial market opportunity.

An investigator-initiated study evaluating SCRX in pressure ulcers is expected to begin in the fourth quarter of 2026. Our collaboration network across the program now spans essentially all the major relevant advanced wound care companies, including Coloplast, Convatec, ACD, Malnika, Solventum, B. Brown, and Mimedix. Together with the continued progress of the value and the expanding clinical and commercial opportunity, this positions Escarex as a non-surgical, optimally effective debridement therapy for chronic wounds.

Turning to Nexobrid. The U. S. commercial trajectory continues to strengthen. Bericel reported NexoBrid's strongest quarter since launch with record quarterly revenue, hospital unit sales, and ordering centers. Approximately 80 burn centers have ordered NexoBrid since launch, reflecting continued adoption and increasing utilization across the U. S. burn care market. Following Vericell's 10-year contract with BARDA, valued at up to $197 million, we entered into a master service agreement with Vericell, covering NexoBrid and next-generation product development activities. Under the MSA, we expect to begin recognizing revenue in the second half of 2026 through participation in development initiatives, including a next-generation program launched to support the potential expansion of Nexobrid for use in blast and friction-related injuries, leveraging real-world evidence.

We continue to advance a room temperature stable formulation of ExoBrid as a non-surgical debridement solution for battlefield burn care, supported by non-dilutive funding from the Department of War, with a total program budget of $18.3 million. Together, these programs further expand ExoBrid's role in burn care, national preparedness, military medicine, and mass casualty response. To support current and future demand, we continue to advance our expanded Nexoprid Manufacturing Facility. We are implementing the modification requested by the EMA following the pre-audit and expect to complete this work during the fourth quarter of 2026. Commercial supply from the expanded facility remains subject to regulatory approval and is expected in the second half of 2027.

With that, I will turn the call over to Hani.

Thank you, Ofer, and good morning, everyone. Turning to our financial results for the second quarter of 2026. Revenue for the quarter was $3.1 million compared with $5.7 million in the second quarter of 2025. The decrease primarily reflected the timing of Barda-funded development revenue. Gross profit was $0.3 million, representing a gross margin of 10.9%, compared with gross profit of $1.3 million, or 23.5% in the prior year period.

The lower margin primarily reflected a one-time impact related to the facility scale-up. Research and development expenses were $5.9 million compared with $3.5 million in the second quarter of 2025, primarily reflecting increased investment in the S-Correct value phase 3 trial.

SG&A expenses totaled $3.9 million compared with $3.6 million in the same period last year. Operating loss was $9.5 million, compared with $5.7 million in the second quarter of 2025. Net loss was $7.4 million, or $0.57 per share, compared with a net loss of $13.3 million, or $1.23 per share in the prior year period. The year-over-year change primarily reflected non-cash financial income. Adjusted EBITDA loss was $8.3 million compared with a loss of $4.5 million in the second quarter of 2025.

Turning to our first half results, revenue for the first half of 2026 was $4.6 million, compared with $9.7 million in the first half of 2025, primarily reflecting the timing of BARDA-funded development revenue. Gross profit was $0.7 million, representing a gross margin of 14.4%, compared with gross profit of $2.1 million, or 21.5% in the prior year period. Research and development expenses were $11.1 million compared with $6.4 million in the first half of 2025, primarily reflecting increased investment in the S-CREX Value Phase III trial. S&G&A expenses totaled $7.5 million compared with $6.6 million in the same period last year, primarily reflecting higher professional services costs and exchange rate effects.

Operating loss was $17.4 million compared with $10.9 million in the first half of 2025. The net loss was $10.3 million, or $0.80 per share, compared with a net loss of $14 million, or $1.30 per share in the prior year period. The change primarily reflected non-cash warrant revaluation income of $7.7 million in 2026, compared with a non-cash warrant revaluation expense of $2.4 million in 2025. Adjusted EBITDA loss was million compared with a loss of million in the first half of 2025 Now turning to our balance sheet.

As of June 2026, we had approximately $36 million in cash, cash equivalents and deposits, compared with $54 million at year-end 2025. Cash burn during the first half of 2026 totaled $20 million. Warrant and option exercises generated $0.8 million during the first half, and we received an additional $1.1 million after quarter end. This concludes my review of our financial results. Offer, back to you.

Thank you, Hani. The second quarter strengthened both our core growth platform. The value phase three program of SCRX continues to advance toward important milestones, while the updated market assessment and planned diabetic foot ulcer and pressure ulcer studies broaden its long-term clinical and commercial opportunity. Next of it continues to gain commercial traction in the United States. At the same time, the MSA with Vericel, the broader BARDA framework, the DOW funding, all that creates meaningful government-backed product supply and development opportunities. Our revenue profile remains weighted toward the second half of 2026, reflecting the expected timing of contributions from the MSA and other government-funded programs.

Based on these expectations contributions, we are reaffirming our full year 2026 revenue guidance of $24 million to $26 million. Our priorities for the remainder of the year are clear. Continue executing the value trial, begin recognizing revenue under the Vericell MSA, advance our next-generation Nexoblid programs, and complete the EMA-requested modification at our expanded manufacturing facility. We remain focused on disciplined execution across our strategic priorities and on building durable, long-term value across our pipeline. Operator?

Hi, RK, and thank you for joining. The first question is a short answer. Yes, our target of meeting the interim assessment and enrollment completion is still in the first quarter of 2027.

As for the second question regarding Smith & Nephew approach to potential competition from S-Corrects, maybe Barry, do you want to take this one?

Sure, absolutely. Hi, RK. We heard those comments, and we found them interesting. I think the thing that's most notable about the comments were the context, where he was talking a little bit about – someone asked him about the competition. He was talking a little bit about his thoughts around Escorax, but then he said that they noted that SANTL is not a fast debridement option, that it is slow.

And because of this, that's what's driving their desire to make this second-generation product. It's actually being developed by a company that they've invested in called CERTA Therapeutics. The molecule is SN, or the drug, I should say, is SN514. Based on all the publicly available information we've been able to see, we're not aware of this drug having entered into any clinical development in chronic wound patients. We see some activity around burns, but not chronic wounds. And so while we take any potential competition seriously, S-Corex, as you know, is already in Phase III in chronic wounds, and that gives us what we believe to be a substantial clinical lead.

So, Barry, maybe you will answer the first part of the question regarding sickness you and the market of pressure ulcer, and I'll speak about the study, okay?

Yes. Well, I think even more broadly, what I think I heard you ask, RK, is does that mean that since Tantal is not particularly effective and that Smith & Nephew is motivated to create a new drug, this must be inferenced is that the market is even bigger than what Tantal is currently supplying? And we believe the answer to that is resoundingly yes. That's why, as we even before including pressure ulcers, you know, we showed, you know, our peak sales in the $800 million range. And with including pressure ulcers, it tops a billion. We believe that a drug for debridement that can reach complete debridement, certainly within four to five days, changes the entire expectation with regard to enzymatic debridement.

It fits better into the workflows of wound clinics and podiatry offices, and it takes away, because of that, utilization share, not just from sharp debridement, but across all different modalities. So we do believe that it greatly expands the market.

If we speak about the pressure ulcer study, it's important to mention that the Phase III value study in VLU, this is the primary focus of SCRx development program. It's, of course, the company's key value driver. The pressure ulcer study is an investigation initiated, so it's not run directly by us. It's a small study, open-label trial, 10-15 patients, and the initiation is expected in the fourth quarter of 2026. It enrolls, of course, pressure ulcer patients. All of them are treated with SCRX across a week or two, and we are assessing, as usually, debridement, granulation, and wound closure. Following the value readout, we plan to approach the FDA and determine what would be required to pursue approvals also for DFUs and pressure ulcers.

So I will address the manufacturing facility question. I think there was a confusion. As I said in the call, we completed the EMA pre-audit, And they had a pre-audit process, and they recommended some operational changes that we are about to complete in the fourth quarter of this year, not the fourth quarter of 2027. So we'll complete all the implementation this year.

The feedback that we got was operational in nature, not related to product quality, safety, or comparability concerns, which is very important. Once this work is complete we will begin the manufacturing of NexoBread in the new facility and then following submission review and inspection we can get approval as early as in the second half of 2027 So we have a delay. We reported this last quarter, but we are currently on track.

As for your second question, the CPT code, Barry, do you want to address it? To my knowledge, there is no publicly available information regarding any update to a Category 1 CPT code.

Hey, Josh. Good to speak to you. So let me speak about the BARDA economics and its strategic importance. So as mentioned, in April, Vericell was awarded a 10-year BARDA contract that is valued at up to $197 million. It is covering next-over-end procurement, vendor-managed inventory, U. S. -based manufacturing readiness, next-generation formulation development, and a potential blast and trauma expansion. It's a multi-year framework agreement with several components, so I understand the appetite for more precision. We are currently not in a position to share additional detail. It reflects confidentiality, obligations to Varicell, as well as the fact that several elements of the program remain subject to further FDA feedback, which could affect the scope of development and work required.

What is concrete today is that the MSA is signed. The first development program, the blast injury and friction injury, is underway, and VeriCell expects about $6 million of BARDA procurement revenue in the second half. Additional elements, including the room temperature stable formulation, the U. S. -based manufacturing readiness, these are areas that we are now in discussions with Versil and BARDA regarding the scope, timing, technical requirements, and potential implementation pathway. So this is the maximum we can share right now. And as I said, we are about to begin recognizing revenue from that program in the second half of 2026. If this is good enough, I'm moving to the DFU.

Okay, so regarding the DFU, we have constructive discussions with the FDA and IMA. We got feedback. We are aligned on the DFU protocol. You can see the highlight of the protocol. It is attached to our corporate deck, and we plan to initiate the study in the fourth quarter of 2026. This Phase II DFU study is expected to enroll 50 patients. It's a randomized trial, one-to-one design, SCRX versus placebo.

And the primary endpoint is something that SCRX is very good at, time to complete debridement. So we see it as a trial, which is not that complicated. As I said to the previous question that I asked by RK, we plan to approach the FDA after the value readout and then to determine what would be required to pursue approval for that indication as well.

Thanks for those answers. Appreciate it.

Hi, Jeff. Good to have you on. As for the first question, you gave there a number that I'm not familiar with, which is the 14. The 14 is not exclusively by BARDA. We have additional government-related agreements, one of them you are familiar with, which is the Department of War, so expect some news there as well. The MSA agreement with BARDA includes a few components. As I said, I cannot give you at this stage use to confidentiality obligations. I cannot give you all the components. Having said that, the first program, which is development of blast and friction burn indication, is on its way. Additional components are currently discussed and negotiated.

As for the procurement, MediWound expects to benefit from the procurement that BARDA has with Vericel. It's not one-to-one. We have the transfer prices with Vericel. Nothing really is disclosed at this stage. But when you speak about the amount of development services, BARDA agreement, it contains a few components and not only one.

Great. Thank you. Okay. This is the first sentence, the first question. As for the second question, Nehemi, do you want to address the manufacturing facility delay?

Yes. So, hi, Jeff. We do not actually expect the current facility timeline to have material impact on our 2026 revenue guidance. And importantly, a meaningful portion of the revenue we expect in the second half is associated, as you know, with government-funded development activity and product supply under existing agreements, rather than being depending on commercial supply from our expanded facility. So our $24 million to $26 million in 2026 revenue guidance already reflect the current status and expected timing of our facility. And as you asked also about 27 and 28, as I mentioned earlier about facility readiness, our plan is to finish all the modifications by the end of the fourth quarter of this year. And first thing that we are going to do next year is to start manufacturing Nexobrid, so we don't think there will be any impact at all to the expected revenue in 27 and 28 for Nexobrid.

Hey, Chase. Good to have you with us. As for the value, let's speak about the numbers to protect the integrity of the study. We cannot show patient enrollment numbers or enrollment trends during the conduct of the study in a multinational study. Individual snapshots can be noisy, and the advice we're getting is not to share any information.

We think the more useful commitment is the milestones. It's the interim assessment and the enrollment completion. What can I say now is that the design hasn't changed. 216 patients, roughly 40 sites, and we expect the interim sample size reassessment and enrollment completion to be by the end of the first quarter of 2027. We do not need any improvements or changes in trends. We are on track. I hope I answered the first question, right?

So, Barry, let me start with answering about the clinical trial, if this is okay. Well, you've got it quite accurately, Chase. Our plan is to have the interim assessments by the end of Q1. If everything goes well, it takes another quarter or so to get the top-line data, and after the top-line data, it is another few months until the final results.

As for SCRx, Barry, do you want to address it?

Sure. You know, most of that shifting, of course, Chase, has to do with the CMS change to how it reimburses the tissue substitute products. Based on the third-party data that we've acquired regarding prescriptions of sample, it's fairly well distributed across acute care into clinics, into home health, and certainly into nursing homes and SNFs, and we don't see that materially changed.

Hi, Michael. So I just wanted to follow up on the question surrounding the 27 revenues, and particularly to understand mechanically how that works with your current projections, since it's nearly a doubling of the Nexabrid-specific revenues that you were projecting. So is this a case where there's pent-up demand that would lead to a surge in sales in the fourth quarter once you get that approval, or can you actually ship the product and recognize revenue before the second half EMA commissioning? Hi, Michael. This is a good question. As I said, we are actually manufacturing the NexoBrid in the beginning of 2027. Everything is ready to be shipped. The demand is there. Second half of 2027, we can sell significantly more than we are selling now.

Currently, as you know, our ability to sell is capped by manufacturing capabilities, and in 2027, this limitation will finally be removed.

All right, and then what is the delay on the EMA side affect FDA? Is that still one half after EMA approval, or would these now be contemporaneous? Mathematically, it's something like three months. Having said that, the most important milestone is getting the first approval. As I mentioned in the previous call, and I'm sure that you remember, EMA comes first. And once EMA comes first, we can start selling substantially most of the inventory to the European countries. And then the current facility can be dedicated to sell to the U. S. market and to stockpile for governments. So this is the more important milestone. So this is why we're speaking about the first regulatory approval. Well, if FDA happens three months after that or five months after that depends on inspections and other things, I don't think it will really change anything in a revenue point of view.

So, yes, you're right. We are reaffirming the $24 million to $26 million revenue guidance for 2026. Since the revenue for the first half was $4.6 million, clearly the majority of the year is weighted towards the second half of the year. We expect meaningful step-up in H2, driven by the product supply related to the contract, development services under the Vericell MSA, and other government-funded programs, including the Department of War. And, of course, the ongoing commercial NexoBread sale.

Under the MSA, we just announced that we initiate the first development program to support the expansion to blast injuries.

But we, as I mentioned, we expect to initiate additional development programs under the MSA in the near term as well.

Hi, Scott. As you know, we are not guiding specifically for products, but I don't think it will be the right thing to do is to think that we sold everything that we could. Again, we are capped only by capacity, not by demand. The inventory of NexoBrid is currently zero, I think, in the most territories and definitely here in the facility.

Some of the impacts that you saw that prevented us to generate more revenue were because of the fact that the facility itself needed to go through all kinds of inspections and all kinds of upgrades, etc. So I think it would be more accurate to look at the second quarter. Having said that, I would look at last year, and we are selling everything that we have. So maybe last year, if you add, let's say, 10% premium because of price changes and a little bit more effectiveness, I think it will be more accurate.

Hi, Scott. The increase in R&D is, as you know, primarily driven by our value phase three trial, which remains our top strategic priority in the company. We are not providing quarterly R&D guidance, but we are currently at an elevated level of investment and expect R&D spending to remain elevated as value progresses through this phase of our program. At the same time, a meaningful portion of our next redevelopment activity is supported, as you know, by non-dilutive government funding through BARDA and through the Department of War.

So while we are investing significantly in value, we are also being very disciplined about where we deploy our own capital. I hope I answered your question.

Thank you, everyone, for joining us today. We look forward to updating you again on our next quarterly call.