On 5/14/25 at the market close, Aytu Biopharma (AYTU) reported excellent quarterly results.
Net revenue increased 32% to $18.5 million versus $14.0 million in Q3 fiscal 2024. The company also was able to reduce operating expenses, which enabled it to make a profit for the quarter of $1.5M, excluding derivative warrant liabilities gain.
The market applauded the quarterly result, as the stock closed at a 92% gain on 5/15/25.
However, buyers of AYTU yesterday may not be aware of a big problem looming. And this was not discussed at all in the company’s earnings call.
The vast majority of AYTU’s revenue for the quarter, $15.4M, or 83%, was from its ADHD portfolio (Adzenys and Contempla). Starting in September 2025, AYTU’s ADHD portfolio will be completely replaced by generics from Teva Pharmaceutical.
AYTU is the former Neos Pharma, which merged with AYTU in a reverse merger in 2021. As stated in this PR from 10/18/17:
“Under the settlement and license agreement, Neos has granted Actavis the right to manufacture and market its generic version of Adzenys XR-ODT under the Actavis ANDA beginning on September 1, 2025, or earlier under certain circumstances.”
Actavis is a subsidiary of Teva Pharma (TEVA), the huge Israeli generic drug manufacturer. It has waited 8 long years to finally be able to sell the generic version of Adzenys. This was a royalty-free settlement.
To make matters worse for AYTU, Teva will later begin manufacturing and selling a generic form of Contempla starting on 7/1/26. There appears to be no royalties paid to AYTU for the generic Contempla either. And not only that, AYTU is required to discontinue selling Contempla once the generic form starts selling. As stated in the settlement agreement:
“Officially Discontinue” shall mean any of: (a) delisting the products described in Neos NDA with the FDA; (b) delisting the Licensed Patents from the Orange Book unless Neos reasonably determines in good faith that such delisting is required under applicable law; (c) seeking action with the FDA to withdraw COTEMPLA XR-ODT™ from the market
Conclusion
These events will swiftly wipe out the majority of AYTU’s AHDH portfolio revenue. AYTU also has about $20M in debt. The company has about the same amount of cash and plans to do an acquisition of another drug which could be costly. AYTU will likely retrace most of the gains made on 5/15/25.