Mayne Pharma transformed from a loss-making generics player into a focused branded pharma company, improving margins and cash flow through divestments, acquisitions, and a strategic pivot toward women’s health.
Key Highlights
- From generics-heavy losses to branded profitability: Shift in product mix drove EBITDA to A$47M and margins to 60.6%
- Strategic reset in 2023 changed the trajectory: Exit from generics + women’s health acquisition reshaped the business model
- Turnaround visible in cash flow, not just revenue: Operating cash moved from -A$42.7M to +A$45.4M in two years
Mayne Pharma traces its roots to FH Faulding & Co, founded in South Australia in 1845. Over nearly two centuries, the business evolved from a local pharmaceutical manufacturer into a listed specialty pharma company, formally established in its current form in 2005.
One constant through that evolution is the Salisbury manufacturing facility near Adelaide. Operational since 1983, it remains central to the company’s production of complex oral and topical drugs, along with contract manufacturing for global clients.
Through the 2000s and 2010s, Mayne built capabilities in drug delivery systems such as modified-release formulations and bioavailability enhancement technologies. These technical strengths shaped its move into niche pharmaceutical segments.
The expansion that set up the fall
The modern company was built through acquisitions, particularly in the US.
A defining moment came in 2016, when Mayne acquired a large portfolio of generic drugs from Teva Pharmaceutical Industries and Allergan. The deal significantly expanded its scale, making it a notable player in the US generics market, including oral contraceptives.
Alongside this, the company acquired and built out dermatology brands and contract manufacturing capabilities. The strategy was straightforward: broaden the portfolio, increase scale, and compete across multiple segments.
It worked for a while. Revenue grew, but margins remained under pressure. Over time, the business became complex, cost-heavy, and increasingly exposed to price erosion in generics.
When scale stopped working
By FY20, the cracks were visible.
Generic drug prices in the US were declining due to intense competition, and Mayne was heavily exposed. A broad portfolio that once supported growth began to weigh on profitability.
Losses escalated over four years:
- FY20: A$92M
- FY21: A$201M
- FY22: A$263M
- FY23: A$317M
Operating cash flow fell to -A$42.7M in FY23.
This was not a cyclical downturn. The structure of the business itself had become unsustainable.
The reset: exit, simplify, refocus
In October 2022, Shawn Patrick O’Brien took over as CEO with a clear mandate: simplify the business and improve margins.
The strategy focused on three moves:
- Exit low-margin generics
- Reduce portfolio complexity
- Build a branded specialty pharma business
The turning point came in early 2023.
Mayne sold its US generics portfolio, around 85 products, to Dr. Reddy’s Laboratories. While the portfolio generated revenue, it dragged margins down.
At the same time, the pharma company acquired a women’s health portfolio from TherapeuticsMD, adding ANNOVERA®, IMVEXXY®, and BIJUVA®.
These two decisions, executed within months, reshaped the company’s direction.
The Arc: FY20 to FY25
| Phase | Year | What Happened | Financial Signal |
|---|---|---|---|
| Decline | FY20–FY21 | Generics pricing weakens, costs rise | Losses accelerate |
| Reset Begins | FY22 | Divestments start, shift away from generics | A$263M loss |
| Bottom | FY23 | Generics exit + women’s health entry, NEXTSTELLIS® launch | A$317M loss, -A$42.7M cash flow |
| Stabilisation | FY24 | Business stabilises, profitability returns | A$388M revenue, A$22.9M EBITDA |
| Recovery | FY25 | Stronger margins and cash flow | A$47M EBITDA, +A$45.4M cash flow, 60.6% margin |
Why women’s health became the core
The shift toward women’s health was not incidental.
Branded specialty drugs in this category face less price erosion than generics. They also operate in more defined therapeutic areas, where clinical differentiation matters more than scale.
By FY25:
- Women’s health contributed 44% of revenue
- Segment revenue grew 25%
- Key products saw consistent demand growth
This segment became the primary driver of both revenue and margin expansion.
Where the business stands now
By FY25, revenue reached A$408.1M. Growth slowed compared to the previous year, but profitability improved.
Revenue mix:
- Women’s health: 44%
- Dermatology: 38%
- International: 18%
Dermatology remains mixed. Older products like ORACEA® faced competition from authorised generics, reducing revenue. Newer brands such as RHOFADE® showed growth, supported by direct-to-patient channels.
The international segment, led by the Salisbury facility, grew steadily and completed a multi-year upgrade. The focus now is on export expansion and better utilisation.
Cash flow tells the real story
| FY23 | FY24 | FY25 | |
|---|---|---|---|
| EBITDA | Negative | A$22.9M | A$47M |
| Operating cash flow | -A$42.7M | +A$8.1M | +A$45.4M |
| Gross margin | — | 56.3% | 60.6% |
The shift in operating cash flow is central.
Even after a A$33.3M shareholder settlement, the underlying business generated positive cash. Cash reserves declined from A$149.3M to A$100.3M, reflecting both the settlement and ongoing investments.
The deal that didn’t happen
In February 2025, Cosette Pharmaceuticals agreed to acquire Mayne Pharma at A$7.40 per share, valuing it at around USD $430M.
The board supported the deal.
However, in November 2025, Australia’s Treasurer Jim Chalmers blocked the transaction on national interest grounds. The concern centred on the potential closure or sale of the Salisbury facility.
By December 2025, the deal was formally terminated.
For shareholders, this meant losing a premium exit and returning to an independent growth path.
Leadership transition at a critical stage
After leading the turnaround, Shawn Patrick O’Brien stepped down in February 2026.
Aaron Gray, previously CFO, was appointed CEO.
The transition comes at a stage where the structural reset is complete, but consistency still needs to be proven.
Risks that remain
| Risk Category | Description |
|---|---|
| US concentration | Heavy reliance on one geography |
| Patent cycles | Revenue drops post exclusivity |
| Product concentration | Dependence on limited portfolio |
| Execution risk | Growth depends on successful launches |
| Manufacturing utilisation | Facility needs higher export output |
The current phase: execution over strategy
Between 2022 and 2024, Mayne Pharma made its hardest decisions. It exited generics, reshaped its portfolio, and absorbed years of losses.
Today, the structure is different.
The focus now is on execution:
- Expanding women’s health products
- Stabilising dermatology
- Scaling international manufacturing
The turnaround has taken shape in the numbers. The next phase will determine whether it holds over time.
(Sources: Mayne Pharma ASX filings and FY25 results (2025); company history disclosures; Takeovers Panel filings; Business Wire; official company announcements and investor materials.)
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