Futura Medical PLC (AIM:FUM, OTC:FAMDF) CEO James Barder talked with Proactive about the company’s interim results, which included a maiden profit, along with the outlook for the business.
The sexual health group increased guidance on both earnings and revenue for the remainder of the year. Its flagship product, Eroxon, a clinically proven treatment for erectile dysfunction, has now launched in ten countries, with its most recent debut in Mexico.
Barder emphasised the significance of Eroxon entering the US market as the first over-the-counter (OTC) treatment for ED, where competitors such as Viagra and Cialis still require a prescription.
Proactive: As a reminder, please can you give us an overview of what Futura does, the markets, and what are the key factors about Eroxon, your lead product, that investors should be aware of?
James Barder: Okay. Yeah, a little bit about Futura. We specialize in the development and commercialization of innovative sexual healthcare products across the world. Our global expertise is in topical gels, and our lead product is Eroxon. This is a breakthrough, clinically proven treatment for erectile dysfunction. It helps men get an erection in ten minutes, and importantly, it is approved as an OTC (over-the-counter) product in many countries across the world, including the US and Europe.
Proactive: You've announced a big increase in revenue and your first profit today. Is this a flash in the pan, and how confident are you for the future?
James Barder: I hope not. I think we're very optimistic about the future. This year has been very good so far. We've launched in ten countries, and we expect further growth in the second half of the year. In fact, this morning we announced that we've just launched in Mexico, and we will also be launching shortly in America. One of our core strategies is building sustainable growth for both Eroxon and other products in our pipeline. We've got a very experienced R&D team working on several other projects as well. We're focused on building a viable consumer healthcare company with strong profits.
Proactive: You mentioned America, and you put out some news earlier this month about Haleon’s launch of Eroxon. Can you talk us through what this means for the group?
James Barder: Yes, in the US, most of the main oral treatments for erectile dysfunction, like Viagra and Cialis, require a doctor’s prescription. The launch of Eroxon in the States is significant because it’s the first time a clinically proven treatment is available without a prescription. The US is the largest consumer healthcare market in the world, so this is a huge opportunity for us. Additionally, our US commercial partner is one of the world’s leading consumer healthcare companies. So, very exciting times for us.
Proactive: That news came out after your half-year end. What have been the key successes for the company so far this year?
James Barder: Obviously, the launches in ten different markets were super important. We announced our maiden profit of £1 million, and if you deduct non-cash items, it’s £2.3 million, with revenue up over 300% to £7 million. Investors should understand that this is pretty meaningful for us. A couple of years ago, the company wasn’t generating any significant income at all, let alone profits. It’s a real milestone. We've also spent more on developing our supply chain, and with demand for Eroxon growing, we now have factories in both the US and Europe.
Proactive: What learnings are you taking from each launch, and how is this beneficial moving forward?
James Barder: We are beginning to get consumer feedback. Interestingly, we’ve now seen data from four independent consumer studies on men who use Eroxon. Over 60% of men are satisfied with the product, which is very similar to the results of our phase three clinical studies. This is great news because it’s real-world data. Of course, it takes time to position a new product correctly, and we are optimizing its positioning in different markets. We’ve found that men up to 60 years old, particularly those in stable relationships, are the optimal users. There are also cultural factors to consider in different countries, but overall, we’re happy with how things are going.
Proactive: Can you remind us how your commercial agreements work? With so much growth, is there going to be an increase in your cost base?
James Barder: We’ve structured the company in a way that sales growth shouldn’t significantly increase internal costs. We primarily sell products through two methods: IP license agreements, where we generate royalties from the intellectual property, and direct sales, where we manufacture Eroxon and sell it ourselves. There are also milestone payments associated with both methods. It’s important to note that Futura doesn’t handle marketing itself; that’s the responsibility of our commercial distributors, who have performance-related obligations.
Proactive: What are your objectives for the remainder of the year?
James Barder: 2024 is a year of execution for us. We’ve got further launches coming, with the US launch being a major one. We’re also progressing other developments, as we have a very experienced R&D team exploring new options. We hope to update shareholders on these developments in the near future.
Proactive: Any closing remarks, James?
James Barder: It’s been an outstanding six months, the best we've had. We’ve achieved significant profits and a significant increase in sales. Considering where we were a few years ago, this is a huge achievement, thanks to the hard work of the entire team. We’re very confident moving forward and have increased guidance today on both profit and revenue for the rest of the year. I think we’re in a good place, and things are going well.