Stonegate Capital Partners Initiates Coverage on Medicus Pharma, Highlighting Strategic Pipeline Expansion

Stonegate Capital Partners has initiated coverage on Medicus Pharma Ltd. (NASDAQ: MDCX), providing investors with analysis of the pharmaceutical company's recent strategic moves and financial position. The coverage comes as Medicus advanced several key initiatives in the second quarter of 2025, building what Stonegate describes as a diversified portfolio of clinical and pre-clinical assets.

The company completed the acquisition of Antev Limited, expanding its therapeutic pipeline into dermatology and infectious diseases. This acquisition complements Medicus' lead microneedle patch technology for skin cancer treatment. Additionally, Medicus entered into a Memorandum of Understanding with Helix Nanotechnologies to co-develop thermostable vaccines for infectious diseases. This collaboration addresses critical global healthcare challenges tied to cold-chain limitations in vaccine distribution. Further details on Stonegate's analysis can be found in their research report.

Financially, Medicus secured an $8.0 million non-dilutive debenture financing during the quarter, strengthening its balance sheet and extending cash runway while minimizing dilution for existing shareholders. These milestones highlight the company's strategy of combining organic development with opportunistic acquisitions to accelerate therapeutic asset advancement.

In the second quarter of 2025, MDCX reported a net loss of $6.2 million compared to $3.6 million in the same period last year, reflecting increased expenses of $4.6 million and research and development investment of $1.4 million. For the six-month period, the net loss widened to $11.3 million versus $5.3 million in the prior year, consistent with the company's expanded development and corporate activities. Cash and equivalents stood at $9.7 million at quarter-end, an increase from $4.2 million at year-end 2024, supported by equity raises, warrant exercises, and $4.5 million in proceeds from the debenture issuance.

Medicus' lead program, SkinJect, is a dissolvable microneedle patch designed for localized delivery of chemotherapeutic agents to treat non-melanoma skin cancers, including basal cell carcinoma. The product is intended for outpatient use, potentially reducing treatment costs and improving compliance relative to surgical and systemic approaches. The Antev acquisition further expands Medicus' portfolio into dermatology and infectious disease assets, while the Helix Nanotechnologies collaboration introduces vaccine development capabilities with a focus on thermostable platforms.

Stonegate employs a probability-adjusted Discounted Cash Flow Model when valuing MDCX, returning a valuation range of $14.91 to $29.35 with a midpoint of $21.13. The model uses a discount rate range of 17.50% to 22.50% and a current risk adjustment range of 50% to 40%. Stonegate notes that this model is highly levered to future years due to the long-term nature of MDCX's industry, leading to potential for dramatic re-ratings as new information becomes available. Additional modeling details are available on page 9 of the research report.