Medicus Pharma issues $8.0 million debenture to Yorkville fund

The debenture

Medicus Pharma Ltd. said on September 18, 2025 that it issued an $8.0 million principal amount debenture to YA II PL, Ltd., an investment fund managed by Yorkville Advisors Global, LP. The company calls the financing non-dilutive. The debenture was issued under a purchase agreement with Yorkville, and Medicus trades on the Nasdaq under the symbol MDCX.

The debenture bears interest at 8% a year and matures twelve months after issue. It is repaid in monthly installments with accrued interest, and the remaining principal and interest fall due at maturity. Each of the company's subsidiaries guarantees it. Medicus may redeem the debenture in whole or in part at any time before maturity, at face value plus accrued and unpaid interest.

The new debenture refinances approximately $1.7 million of debentures that Yorkville bought in May and June 2025 and that remain outstanding. After that refinancing, original issue discount and fees, Medicus expects net proceeds of approximately $5.7 million.

Lender terms that cut the other way

The company's own description of the deal leaves out several terms that limit it. Yorkville may require Medicus to redeem all or part of the debenture from the proceeds of any equity financing during its term. The one exception is the standby equity purchase agreement already in place between the two companies. Yorkville may also withhold certain payments on the debenture from the proceeds of that standby agreement.

The debenture limits new debt and liens for Medicus and its subsidiaries. If an event of default occurs, the interest rate rises to 18% until the default is cured. The release lists these terms as customary, but together they tie any new equity raise to the lender and set a penalty rate if the company misses a payment or breaches a covenant.

The release names no placement agent, bank or legal counsel for the debenture. The purchase agreement is between Medicus and Yorkville directly.

The program and the trial record

Medicus says it will use the proceeds to accelerate development of Teverelix, a next-generation GnRH antagonist it describes as a first-in-class product for acute urinary retention and for prostate cancer in men at high cardiovascular risk. The company puts the combined potential market at about $6 billion. That figure is the company's own estimate, and the release gives no source for it.

The release also describes the earlier clinical record of Teverelix, and that record is less favorable than the market claim. A Phase 1 study in 48 healthy male volunteers showed rapid testosterone suppression. A Phase 2a study in 50 patients with advanced prostate cancer met its primary endpoint, a probability of 97.5% of castration levels of testosterone suppression. The secondary endpoint was not met: the probability of staying at castration levels fell to 82.5% by Day 42, short of the 90% target. The FDA approved the designs of two Phase 2b studies, one in 40 patients with advanced prostate cancer and one in 390 patients with acute urinary retention. Design approval is not trial data, and the release reports no results from either study.

Going-concern doubt

Medicus's annual report filed in March 2025 says the auditor has indicated "substantial doubt about the Company's ability to continue as a going concern." The filing says the company may be forced to curtail or discontinue its operations if it cannot obtain more financing. The September release does not give Medicus's cash balance, its burn rate or how long the net proceeds will last. Investors cannot judge from the release how much of the $5.7 million will go to development and how much will go to the company's existing obligations.

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