ORAMED PHARMACEUTICALS INC. Annual Report Summary

I’ve put together this guide to help you understand Oramed Pharmaceuticals’ performance over the past year. My goal is to explain their complex filings in plain English so you can decide if this company fits your investment goals.

1. What does this company do?

Oramed is a drug developer focused on its "POD™" platform. Their mission is to replace injectable medications—like insulin for diabetes—with oral capsules. Their technology uses a special coating to protect the medicine as it travels through the digestive system.

Beyond drug development, Oramed now uses a "hybrid" business model. They invest their cash into other biotech companies. They hope these investments will generate profit to help cover the high costs of their own drug research.

2. Financial performance

Oramed is currently in a transition phase. For the year ending December 31, 2023, they brought in $2.6 million in revenue, mostly from consulting and licensing.

Their bottom line depends heavily on their investment portfolio. They spent $23.6 million on research and development, resulting in an overall loss of $30.8 million. This loss fluctuates based on the changing market value of their shares in companies like Scilex, BioXcel, and Alpha Tau Medical.

3. Major wins and challenges

• Clinical Progress: Oramed is preparing a 60-patient Phase 2 trial for its oral insulin pill in the U.S., expected to start in late 2026. This smaller study aims to prove the drug works without the massive costs of a large-scale trial.
• Investment Strategy: The company has aggressively invested its cash. They put $38 million into Alpha Tau Medical for a 17% stake. They also brought in $28.5 million by selling warrants in Scilex, which helped fund their daily operations.
• The "Breakup": Oramed ended its partnership with Hefei Tianhui Biotech following a dispute over developing oral insulin in China. As a result, Oramed no longer expects the future milestone payments that were previously tied to that agreement.

4. Financial health

At the end of the year, Oramed held $84.5 million in cash and short-term investments. Because they are currently losing money on operations, they rely on these cash reserves and the sale of their investments to fund their activities. Because their portfolio value changes with the stock market, their reported profit or loss can swing significantly from quarter to quarter.

5. Key risks

• Clinical Success: The company’s long-term value depends heavily on the success of its oral insulin pill. If the 2026 trial does not meet its goals, the company’s valuation could be negatively impacted.
• Investment Risks: Oramed is now heavily tied to the stock market. If their investments in companies like Alpha Tau lose value, Oramed must report those as losses, which lowers their total profit.
• Complexity: The hybrid model makes the stock harder to value. Investors must track both the success of their drug trials and the financial health of the companies they own.

6. Future outlook

Management is currently prioritizing the 2026 U.S. trial as their main way to create value. They may sell more of their current investments to keep their cash reserves high, look for new technologies to license, or buy back their own shares if they believe the stock is undervalued.

How to use this information: When considering an investment in Oramed, ask yourself if you are comfortable with a "hybrid" biotech company. You are essentially betting on two things: the scientific success of their oral insulin pill and the financial performance of their stock market investments. If you prefer a company focused solely on drug development, the complexity of their current investment portfolio may be a factor to weigh carefully.