Futura Medical PLC (AIM:FUM, OTC:FAMDF, FRA:GYX), the sexual health group behind the Eroxon erectile dysfunction gel, has begun a formal process that could see the sale of the business, or its assets.
The move comes alongside a placing and subscription to raise approximately £1.6 million, which should fund it through to the conclusion of negotiations.
The company said its current market valuation did not reflect the strategic value of its portfolio, which includes Eroxon, the female sexual health project WSD4000 and a new formulation called Eroxon Intense.
Futura estimates WSD4000 alone could generate peak annual consumer sales of more than $400 million, against over $250 million for its Eroxon products combined.
The board said it would explore a range of strategic alternatives, including the sale of individual assets, licensing deals, or the sale of the whole company.
Present Value, a specialist life sciences adviser, has been appointed alongside existing broker Panmure Liberum to run the process.
Interested parties will be invited to submit non-binding offers by 2 October.
The fundraise comprises a firm placing, a conditional placing, a subscription and a retail offer, together raising up to £1.75 million before expenses.
Proceeds are expected to extend the company's cash runway into February 2027, giving the board time to complete the strategic review.
Eroxon, the first clinically proven topical treatment for erectile dysfunction to gain over-the-counter status internationally, has seen slower-than-expected sales since launch.
The company recently ended its commercial relationship with Haleon and appointed Market Performance Group as its new US partner from 1 September.
Futura said conducting a pivotal study for WSD4000, needed to support a full US regulatory claims platform, would require a further £4 million.
The board argued that continuing to raise capital as a standalone listed company risked further dilution without securing the resources needed to maximise the value of its assets.
A general meeting to approve the fundraising resolutions will be held on 23 September.
Directors, who together hold just over 1% of the company's existing shares, have committed to vote in favour of the resolutions.