Botanix Pharmaceuticals (ASX:BOT) has taken a major step to strengthen its commercial momentum and long-term manufacturing strategy, securing commitments for approximately $45 million in fresh capital as it looks to expand production, stabilise supply and accelerate growth of its lead dermatology product, Sofdra.
The funding package combines a two-tranche institutional placement expected to raise about $40 million with a further share purchase plan targeting roughly $5 million from existing investors. Together, the raising is designed to give the company greater operational flexibility while supporting its rapid commercial expansion.
The company said strong demand from both new and existing institutional investors allowed it to close the placement bookbuild quickly, reflecting confidence in the company’s first year on market and the continued uptake of Sofdra, its FDA-approved treatment for excessive underarm sweating. The company has experienced steady quarter-on-quarter prescription growth since launch and recently expanded its sales force to 50 representatives, a move expected to further boost adoption in the coming quarters.
A significant portion of the new capital will be directed toward securing supplies of the active pharmaceutical ingredient (API) used in Sofdra and supporting manufacturing components. Botanix is contractually required to purchase additional API and expects strong prescription growth to continue, making inventory security a near-term priority.
At the same time, the company is pursuing a longer-term strategy to reduce risk and cost in its production chain. It said negotiations are underway with both its current supplier and potential alternative manufacturers to smooth payment schedules and eventually introduce a second supply source. Management believes that establishing an additional supplier, potentially in North America or Europe, could reduce the cost of goods sold by 25 to 40 per cent while strengthening supply chain resilience.
Beyond manufacturing security, Botanix sees the capital raise as a platform for broader strategic growth. The company plans to invest in marketing initiatives, expand its fulfilment platform with additional products, and pursue licensing opportunities for Sofdra in new international markets. Executives also see the stronger balance sheet improving Botanix’s position in potential merger or acquisition discussions.
Executive Chairman Vince Ippolito said the successful raise positions Botanix to meet growing demand while preparing for the next phase of development. With the company focused on securing supply, expanding sales capacity and exploring new commercial partnerships, he described the period ahead as an important stage in Botanix’s evolution.