Oramed Pharmaceuticals Inc . (NASDAQ:ORMP), a biotech firm specializing in pharmaceutical preparations, has received a substantial payment towards a promissory note as per a recent transaction with Scilex Holding Company. On Monday, the company announced that it obtained approximately $10.4 million from Scilex, which counts towards the third principal payment installment of the note, bringing the total amount paid to $40 million as of last Thursday.
The original agreement, dated September 21, 2023, involved Scilex assuming certain outstanding obligations of Sorrento Therapeutics (OTC:SRNE), Inc. In return, Scilex provided Oramed with a Senior Secured Promissory Note due 18 months from the date of issuance, amounting to $101.875 million, along with warrants to purchase shares of Scilex's common stock.
The payment is part of a series of principal payments that Scilex is required to make under the terms of the note. To date, Oramed has received an aggregate of $29.6 million in principal payments before the most recent transaction.
The information in this article is based on a press release.
InvestingPro Insights
Oramed Pharmaceuticals Inc. (NASDAQ:ORMP) has shown a notable financial event with the receipt of the payment from Scilex. To further understand Oramed's financial health and future prospects, key metrics and InvestingPro Tips can provide valuable insights. With a market capitalization of $93.45 million and holding more cash than debt, Oramed appears to have a solid balance sheet. However, analysts are forecasting a sales decline in the current year, and they do not expect the company to be profitable within this timeframe. This is reflected in the adjusted P/E ratio for the last twelve months as of Q1 2024, which stands at -13.22, indicating investor concerns about future earnings.
Despite these challenges, Oramed has a strong gross profit margin of 100% for the same period, although it's important to note that the revenue growth has significantly declined by -75.06%. Additionally, the company's liquid assets exceed its short-term obligations, suggesting a degree of financial flexibility in the near term. The stock price has experienced considerable volatility, with a one-year total return of -29.23%, emphasizing the importance for investors to consider the potential risks associated with such movements.
For those looking to delve deeper into Oramed's financials and future outlook, there are additional InvestingPro Tips available. These tips can be accessed through the InvestingPro platform at https://www.investing.com/pro/ORMP, which currently lists seven more tips that could be crucial for making informed investment decisions. Remember to use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, unlocking further insights and analysis that could be beneficial in assessing Oramed's investment potential.
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