Oramed inks $27M deal to sell Scilex warrants, bolstering cash

Rhea-AI Filing Summary

Oramed Pharmaceuticals (ORMP) filed an 8-K disclosing an Option Agreement signed 22-Jul-25 with Scilex Holding. The accord gives Scilex the right to repurchase Oramed’s remaining 6.5 M “Penny Warrants” (exercise price $0.01/sh) in two tranches for a total cash consideration of $27 M. To secure the option, Scilex will pay Oramed $1.5 M in two equal installments due 8-Aug-25 and 16-Dec-25.

• Tranche 1: up to 3.13 M warrants for $13 M if exercised by 30-Sep-25.
• Tranche 2: up to 3.37 M warrants for $14 M if exercised by 31-Dec-25.

If Scilex completes the repurchase and makes all payments, the maturity of the $101.9 M Tranche A senior secured note held by Oramed will be extended to 31-Mar-26 and its make-whole prepayment penalty waived.

Until the earlier of option expiry or termination, Oramed has agreed not to exercise the warrants. Oramed can terminate the agreement if Scilex misses any payment or fails to exercise by the set dates. Post-termination, Scilex will seek shareholder approval to permit stock issuance above a 19.9 % cap should Oramed later exercise retained warrants.

The filing also clarifies prior disclosure: despite Scilex’s 1-for-35 reverse split, the Penny Warrant exercise price remains $0.01 and the quantity remains 6.5 M shares; no impact to previously reported Q1-25 financials.

Positive

• Potential $28.5 M cash inflow (option + warrant repurchase) strengthens liquidity.
• Note maturity extension to 31-Mar-26 and make-whole waiver reduce refinancing pressure if repurchase completes.
• Termination rights allow Oramed to retain warrants if Scilex defaults.

Negative

• Loss of upside from 6.5 M low-priced warrants if Scilex share price appreciates after sale.
• Execution risk: receipt of funds depends on Scilex making scheduled payments.
• Temporary restriction on exercising warrants limits flexibility until option expiry or termination.

Insights

Sell-side Equity Analyst

TL;DR: Adds $1.5-28.5 M near-term cash, but caps upside tied to Scilex equity.

The option could deliver up to $28.5 M (option + repurchase) to Oramed over the next five months—meaningful versus its c.$80 M FY-24 cash. Near-term liquidity improves without equity dilution. However, Oramed sacrifices leveraged upside on Scilex’s share price; the warrants have intrinsic value of only ~$65 K today but large convexity if Scilex rallies. The agreement’s termination rights protect Oramed if Scilex defaults, and the note-maturity extension/waiver has no immediate P&L effect yet lowers credit risk. Overall impact: modestly positive for cash runway, neutral for long-term optionality.

Risk Analyst

TL;DR: Counterparty execution risk and shareholder-approval constraints remain.

Payments are contingent on Scilex’s liquidity; failure to pay lets Oramed cancel but leaves warrant exercise timing uncertain. The 19.9 % issuance cap could delay monetisation if the option lapses. While the secured note deadline moves to 2026 only if the deal closes, Oramed gains no additional collateral. Hence, credit profile slightly improves yet still hinges on Scilex performance.

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

Date of report (Date of earliest event reported): July 22, 2025

ORAMED PHARMACEUTICALS INC.

(Exact name of registrant as specified in its charter)

delaware		001-35813		98-0376008
(State or Other Jurisdiction of Incorporation)		(Commission File Number)		(IRS Employer Identification No.)

1185 Avenue of the Americas, Third Floor, New York, New York		10036
(Address of Principal Executive Offices)		(Zip Code)

844-967-2633

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading symbol		Name of each exchange on which registered
Common Stock, par value $0.012		ORMP		The Nasdaq Capital Market, Tel Aviv Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 1.01 Entry into a Material Definitive Agreement.

Option Agreement for the Repurchase of Warrants

As previously disclosed, on September 21, 2023, Oramed Pharmaceuticals Inc. (the “Company”) entered into and consummated the transactions contemplated by a Securities Purchase Agreement (as amended by that certain Amendment No.1 thereto, the “2023 SPA”) with Scilex Holding Company (“Scilex”) and Acquiom Agency Services LLC (the “Agent”). Pursuant to the 2023 SPA, Scilex issued to the Company (i) a Senior Secured Promissory Note due 18 months from the date of issuance in the principal amount of $101,875,000 (the “Tranche A Note”), and (ii) warrants to purchase up to an aggregate of 13,000,000 shares of Scilex’ common stock, par value $0.0001 per share (“Scilex Common Stock”) at an exercise price of $0.01 per share (the “Penny Warrants”). The Company subsequently exercised Penny Warrants to purchase an aggregate of 6,500,000 shares of Scilex Common Stock, and currently holds Penny Warrants to purchase an aggregate of 6,500,000 additional shares of Scilex Common Stock (the “Subject Warrants”). On April 15, 2025, Scilex completed a reverse stock split of its common stock at a ratio of 1-for-35 (the “Scilex Reverse Stock Split”). The terms of the Penny Warrants provide that the exercise price and amounts of Scilex Common Stock issuable pursuant to such warrants will not adjust as a result of a reverse stock split. Accordingly, following the Scilex Reverse Stock Split, the exercise price of the Penny Warrants continues to be $0.01 per share and the Company continues to hold Penny Warrants exercisable for 6,500,000 shares of Scilex Common Stock.

On July 22, 2025, the Company entered into an Option Agreement for the Repurchase of Warrants with Scilex (the “Option Agreement”) pursuant to which, among other things, the Company granted Scilex an option (the “Option”) to repurchase the Subject Warrants in two tranches (the “Warrant Repurchase”) for an aggregate purchase price of $27,000,000 (the “Warrant Repurchase Amount”), subject to the terms and conditions set forth therein. In consideration of the Option, Scilex agreed to pay $1,500,000 (the “Option Payment Amount”) to the Company in two equal installments occurring on or before August 8, 2025 and December 16, 2025, respectively. Provided that Scilex has made the applicable option payment on or before such dates, it shall be entitled to purchase the Subject Warrants as follows: (i) on or before September 30, 2025, it may repurchase 3,130,000 Subject Warrants for an aggregate purchase price of $13,000,000, and (ii) on or before December 31, 2025, it may repurchase 3,370,000 Subject Warrants for an aggregate purchase price of $14,000,000. Additionally, if Scilex effects the Warrant Repurchase and has paid the Option Payment Amount and Warrant Repurchase Amount in full, in accordance with the terms of the Option Agreement, then the maturity date of the Tranche A Note shall be extended to March 31, 2026 and any make-whole payment due thereunder upon prepayment shall be waived.

The Company agreed to not exercise the Subject Warrants until the earlier of the date on which (i) Scilex forfeits the right to exercise all or part of the Option pursuant to the terms of the Option Agreement and (ii) the termination of the Option Agreement pursuant to its terms (an “Option Termination”).

The Option Agreement contains customary representations and warranties of the Company and Scilex. The Option Agreement may be terminated by the Company by written notice to Scilex if Scilex (i) fails to make any of the payments required under the Option Agreement or (ii) has not exercised the Option by the applicable date set forth in the Option Agreement.

Pursuant to the terms of the Option Agreement, Scilex agreed that, if the Option Agreement is terminated pursuant to the terms set forth therein, it will use commercially reasonable efforts to obtain the approval of its stockholders to permit the issuance of shares of Scilex Common Stock in excess of the Stockholder Approval Cap (as defined in the Option Agreement) upon exercise of any Subject Warrants retained by the Company following such termination, subject to the terms and conditions set forth therein. The Company agreed that it would only exercise the Subject Warrants to the extent that such exercise would not cause the issuance of shares of Scilex Common Stock in excess of 19.9% of the total number of shares of Scilex Common Stock issued and outstanding immediately prior to the original issuance date of the Subject Warrants (after giving effect to the Scilex Reverse Stock Split) unless Scilex obtains stockholder approval for such issuance.

The foregoing summary of the Option Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the agreement, a copy of which is filed herewith as Exhibit 10.1 and is incorporated herein by reference.

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Item 8.01 Other Events.

On May 15, 2025, the Company filed its Quarterly Report on Form 10-Q for the quarter ended March 31, 2025 (the “Form 10-Q”), which stated that the Company owned 185,715 Subsequent Penny Warrants (which are referred to in this Current Report on Form 8-K as the Penny Warrants) with an exercise price of $0.35 per share after giving effect to the Scilex Reverse Stock Split. The Company is hereby clarifying that the exercise price and amounts of Scilex Common Stock issuable pursuant to such warrants did not adjust as a result of Scilex’s Reverse Stock Split. Accordingly, as noted above in Item 1.01, following the Scilex Reverse Stock Split, the exercise price of the Penny Warrants continues to be $0.01 per share and the Company continues to hold Penny Warrants exercisable for 6,500,000 shares of Scilex Common Stock. This clarification has no impact on the Company’s financial position, results of operations, or cash flows as of March 31, 2025, as reported in the Form 10-Q. This clarification is being provided to ensure alignment between the Company’s public disclosures and the specific terms of the Penny Warrants.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit Number		Description
10.1#		Option Agreement for Repurchase of Warrants, dated July 22, 2025, between Scilex Holding Company and Oramed Pharmaceuticals Inc.
104		Cover Page Interactive Data File, formatted in Inline Extensible Business Reporting Language (iXBRL).

# Certain portions of this document constitute confidential information and have been redacted in accordance with Regulation S-K, Item 601(b)(10).

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	ORAMED PHARMACEUTICALS INC.
	By:	/s/ Nadav Kidron
	Name:	Nadav Kidron
	Title:	President and CEO

July 23, 2025

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FAQ

How much cash could ORMP receive from the Scilex warrant repurchase?

Up to $28.5 M—$1.5 M for the option plus $27 M if Scilex buys all 6.5 M warrants.

What are the key dates for Scilex’s option to repurchase the warrants?

Tranche 1 by 30-Sep-25 ($13 M) and Tranche 2 by 31-Dec-25 ($14 M).

Does the Scilex reverse stock split affect the Penny Warrant terms?

No. The exercise price remains $0.01 and Oramed still holds 6.5 M warrants.

What happens to the $101.9 M Tranche A note if the repurchase closes?

Its maturity extends to 31-Mar-26 and any make-whole payment is waived.

Can Oramed exercise the warrants while the option is outstanding?

No. Oramed agreed not to exercise until the option lapses or is terminated.