BDRX — H1 2026 Financial Report Analysis

A smaller loss on paper, a faster cash burn in reality

Biodexa Pharmaceuticals, a UK-based drug developer that sells nothing yet and is focused on gastrointestinal cancers, reported a first-half 2026 net loss of £1.84 million, about half the £3.81 million loss of the first half of 2025. That improvement is mostly an accounting gain rather than a better business: £2.38 million of "finance income" came from revaluing warrants the company had issued, and that gain only appeared because Biodexa's own share price fell. The figure that matters more for a company like this is cash. Cash used to run the business rose 40% to £4.61 million, and cash on hand dropped from £8.53 million at the end of 2025 to £3.23 million at June 30, 2026. The directors say Biodexa will need more financing during the fourth quarter of 2026, and they flag a "material uncertainty" about whether it can continue as a going concern (the accounting term for whether a company can keep operating for the next 12 months).

At a glance

• £3.23 million cash at June 30 (down from £8.53 million in December). At the first half's pace of £4.61 million of operating cash out in six months (about £0.77 million a month), that is roughly four months of operating spending before the money raised after the period.
• Loss from operations widened to £4.21 million from £4.02 million. The halving of the net loss came from a £2.38 million non-cash gain on warrant liabilities, not from lower spending.
• R&D spending up 75% to £2.92 million. Most of the increase went into the Serenta Phase 3 trial of eRapa, the company's lead drug, which had enrolled 92 of a planned 168 patients by September 11.

The numbers

Biodexa reports in British pounds under IFRS (international accounting standards). Figures below are for the six months to June 30, unaudited.

"n/m" means not meaningful. Loss per ordinary share was £0.000005 (1H25: £0.0002). With roughly 373 billion ordinary shares in issue on average, that per-share figure says little; the swing mostly reflects a near-15-fold increase in the share count (weighted average of 373.2 billion vs 25.3 billion).

Where the money went

Biodexa has had no revenue since its last research collaboration ended in September 2023, so its income statement is just the cost of running trials and the company.

R&D by program (£'000, net of grant income):

The company says the increase was "predominantly due to increased activity on the MTX230 Serenta clinical trial, which increased by £1.04 million, and manufacturing costs on the Company's new MTX240 program of £0.30 million."

eRapa is Biodexa's own oral form of rapamycin (sirolimus), an existing drug that blocks a growth pathway called mTOR. It is being tested in familial adenomatous polyposis (FAP), an inherited condition in which the gut fills with polyps and which, untreated, almost always leads to colorectal cancer. There is no approved drug for FAP; patients are monitored and have surgery. The Serenta trial is a placebo-controlled Phase 3 study (the last stage before a drug can be submitted for approval) with a goal of 168 high-risk patients. It runs at 19 US centers and 10 centers in five European countries, and Health Canada approved two Canadian sites in June, which are expected to start enrolling in the fourth quarter.

MTX240 was licensed from Otsuka in February 2026 for global rights outside Japan, for a $500,000 upfront fee plus milestones and mid-single-digit royalties on any sales. It is a "molecular glue," a drug that forces two proteins together to kill tumor cells. Biodexa plans to use it in gastrointestinal stromal tumors (GIST) that have stopped responding to the standard kinase-inhibitor drugs. The company is preparing for a pre-IND meeting with the FDA (an early conversation before asking permission to start US trials).

What the headline numbers hide

• The smaller loss is a share-price effect. Biodexa carries a liability for warrants (rights sold to investors to buy shares later) whose value moves with its share price. The filing states the £2.38 million gain "arose as a result of the fall in the Biodexa share price." Without that gain, the pre-tax loss would have been about £4.18 million, versus about £4.12 million a year earlier on the same basis: essentially flat, not halved. The warrant liability on the balance sheet fell from £2.92 million to £0.53 million.
• Cash burn was 2.5 times the reported loss. Operating cash outflow was £4.61 million against a £1.84 million net loss. Beyond the non-cash warrant gain, the company also paid down £0.96 million of bills owed to suppliers (trade and other payables).
• Lower overheads are mostly currency. Of the £0.64 million fall in administrative costs, about £0.48 million came from foreign exchange: a £0.08 million gain this half versus a £0.40 million charge a year ago. Professional fees fell by a further £0.12 million. The underlying cost base barely moved.
• The grant is covering less of the trial. The eRapa FAP program is co-funded by a grant from the Cancer Prevention and Research Institute of Texas (CPRIT), which Biodexa credits against R&D. Gross FAP trial costs were £4.24 million (1H25: £2.36 million), and the grant offset 66% of them versus 89% a year earlier, so the net charge jumped from £0.25 million to £1.42 million. Management expects coverage to average 67% over the grant's life, so the higher net cost of the trial is the new normal, not a blip. The grant escrow balance held in prepayments also fell from £2.84 million to £0.53 million.
• A small unexplained line. "Other income" rose to £0.44 million from £0.03 million; the release does not say what it was. It helped hold the operating loss down.
• Shareholders are being heavily diluted. Ordinary shares in issue rose from 225.8 billion at December 31 to 373.1 billion at June 30, mainly from warrant exercises. The company changed its ADS ratio in April (from 100,000 to 500,000 ordinary shares per ADS) and consolidated its shares 10,000-to-1 in July, so share counts across periods are not directly comparable. Those changes do not affect the underlying dilution.
• Most of the remaining equity is intangible. Total equity was £9.61 million, of which £6.01 million was capitalized drug rights (tolimidone £2.94 million, eRapa £2.71 million, MTX240 £0.37 million). These only have value if the programs advance or are partnered.

Funding: the central issue

After June 30, Biodexa raised $3.5 million gross on July 1 by selling ADSs and pre-funded warrants at $2.85 and inducing a holder to exercise older warrants. A separate 6-K filed September 15 shows a second step: the same new Series M, N and O warrants (2,204,218 ADSs in total) had their exercise price cut from $2.85 to $1.05 to get them exercised early, for expected gross proceeds of about $2.3 million. In exchange the holder receives two new Series P warrants for each one exercised. Cutting an exercise price by about two-thirds within 11 weeks, and adding about 4.4 million new warrants, is a costly way to raise roughly $2.3 million.

Even so, the directors' forecasts in the interim report "show that further financing will be required during Q4 2026." Biodexa has a $35 million equity line of credit (an agreement letting it sell shares to one investor over time), with $26.08 million undrawn at June 30, but the company says there is "no guarantee" it can use it. The directors also note that Biodexa's market value is below the $5 million minimum that Nasdaq has proposed for listed companies. That rule is on hold pending SEC review, but if it takes effect it could threaten the listing. The auditor's report on the 2025 accounts already drew attention to the going-concern uncertainty.

Takeaway: The halved net loss is an accounting effect of a falling share price. What matters is that Biodexa used £4.61 million of cash in six months, had £3.23 million left, and says it needs new money again in Q4 2026. Its Phase 3 trial is progressing, but for shareholders the near-term question is how much more dilution it takes to reach results.

What to watch next

• Bladder cancer readout, expected Q4 2026. An investigator-led Phase 2 trial of eRapa in non-muscle invasive bladder cancer is fully enrolled at 166 patients and funded by a $3.0 million National Cancer Institute grant. It is the nearest data event and Biodexa does not pay for it.
• Serenta enrolment. The trial passed 50% enrolment in early August and was at 92 of 168 by September 11. The pace of enrolment, including the Canadian sites from Q4, sets when the trial can finish and therefore how long Biodexa must keep funding it.
• The Q4 2026 financing. Watch the size and price of any raise and whether it uses the equity line or another warrant-heavy deal. The 10,000-to-1 consolidation in July already shows how much the share count has been stretched.
• MTX240. The CEO said the planned Phase 1b/2a trial in GIST is designed to show a safe dose and an efficacy signal "before the end of 2027." Getting there requires the pre-IND meeting with the FDA, trial supplies (being made by Syngene) and, again, cash.

Our view: Biodexa's science story has improved since 2025, with a registrational trial past halfway and a second oncology asset added cheaply. Its financial position has not. With roughly a quarter's worth of operating cash at June 30 before the summer raises, each step forward depends on the next financing. This is the first Biodexa period we have covered, so there is no earlier outlook to check against. The next scheduled update is the full-year 2026 annual report on Form 20-F.