Executive Summary / Key Takeaways

• Alpha Tau Medical (DRTS) is an innovative clinical-stage oncology company focused on its proprietary Alpha DaRT (Diffusing Alpha-emitters Radiation Therapy) technology, designed for highly targeted treatment of solid tumors with minimal impact on healthy tissue.
• The company is advancing its Alpha DaRT platform through multiple clinical trials, notably achieving a significant milestone with the first patient treated in its U.S. multi-center pancreatic cancer (IMPACT) study in September 2025, building on promising interim data from earlier pancreatic cancer trials showing over 90% disease control.
• Alpha DaRT's technological edge lies in its ability to deliver potent alpha particles locally and precisely, offering potential benefits such as single-session treatment, systemic response activation, and minimally invasive delivery for deeply located tumors, positioning it as a differentiated solution in high-unmet-need cancers.
• Financially, Alpha Tau is a pre-revenue company with consistent R&D investments, reflected in annual net losses, but a recent $36.9 million strategic investment from Oramed Pharmaceuticals in April 2025 significantly bolstered its liquidity, providing capital for accelerated clinical development and commercialization efforts.
• The investment thesis hinges on the successful progression and regulatory approval of Alpha DaRT across its diverse clinical pipeline, particularly in challenging indications like pancreatic cancer and glioblastoma, against a backdrop of intense competition from established radiation therapy providers and broader oncology players.

The Dawn of Precision Alpha Radiation in Cancer Treatment

Alpha Tau Medical (NASDAQ:DRTS) stands at the forefront of a specialized segment within oncology, dedicated to revolutionizing solid tumor treatment through its innovative Diffusing Alpha-emitters Radiation Therapy, or Alpha DaRT. As a clinical-stage Israeli oncology therapeutics company, Alpha Tau's core mission, since its founding in 2016, has been to develop curative technologies that deliver potent alpha radiation with unparalleled precision. This strategic focus positions the company within the highly competitive and rapidly evolving landscape of cancer care, where the demand for more effective, less invasive, and highly targeted therapies continues to grow.

The oncology market is characterized by continuous innovation, with established players like Accuray Inc. , Elekta AB , and Bayer AG offering a range of radiation therapy systems and targeted treatments. Alpha Tau, however, carves out a distinct niche with its Alpha DaRT technology. While Accuray and Elekta provide comprehensive external beam radiation platforms, and Bayer offers radiopharmaceuticals, Alpha Tau's approach involves direct intratumoral delivery of alpha-emitters. This distinction is critical, as it aims to provide a localized, high-dose treatment that spares surrounding healthy tissue, a significant advantage in sensitive anatomical locations. The company's strategy emphasizes early-stage innovation and clinical development, differentiating it through a focus on diffusing alpha-emitters that could provide superior tumor-specific efficacy.

Alpha DaRT: A Technological Edge in Targeted Oncology

The Alpha DaRT technology is designed to enable highly potent and conformal alpha-irradiation of solid tumors. It achieves this through the intratumoral delivery of radium-224 impregnated sources. Upon decay, the radium releases short-lived daughter isotopes from these sources, which then disperse within the tumor while emitting high-energy alpha particles, aiming to destroy cancerous cells. A key benefit of this mechanism is that these alpha-emitting atoms diffuse only a short distance, primarily affecting the tumor and largely sparing the healthy tissue around it.

This precision offers several tangible advantages over conventional radiation therapies. Alpha DaRT sources are engineered to emit powerful alpha particles that travel only a short range in tissue, making them particularly ideal for pancreatic tumors, which are often surrounded by critical structures. This biological effectiveness may offer a novel pathway to achieve local control in a conformal manner during a single treatment session, a stark contrast to the more lengthy regimens associated with conventional radiation therapy. Furthermore, the technology holds the potential to activate a systemic response to the treatment, extending its anti-cancer effects beyond the initially treated area. The minimally invasive delivery of Alpha DaRT sources into pancreatic tumors, guided by real-time endoscopic ultrasound, enables seamless and accurate placement, allowing access to deeply located tumors with precision and potentially fewer side effects.

Alpha Tau's commitment to advancing this technology is evident in its robust R&D pipeline. Interim results from three pancreatic cancer trials, presented in January 2025, demonstrated a disease control rate exceeding 90%, impressive overall survival in subgroup analyses, and a positive safety profile. Building on this, the company successfully treated the first patient in its U.S. multi-center pancreatic cancer clinical trial, known as IMPACT, in September 2025. This pilot study aims to enroll up to 30 patients with newly diagnosed unresectable locally advanced or metastatic pancreatic adenocarcinoma across centers in the U.S., Canada, and Israel. The primary objectives are to assess the feasibility of Alpha DaRT source implantation and evaluate its safety and tolerability, with secondary objectives including local tumor response, progression-free survival, and overall survival. Crucially, for patients with inoperable locally advanced disease, the study will also evaluate the percentage who become surgically resectable after Alpha DaRT treatment. This could represent a transformative outcome for a patient population facing a dismal prognosis.

Additionally, Alpha Tau received FDA approval for an Investigational Device Exemption (IDE) in August 2025 to conduct a U.S. pilot study for recurrent glioblastoma multiforme (GBM), a highly aggressive brain cancer. These R&D initiatives, coupled with the strategic marketing alliance and $36.9 million investment from Oramed Pharmaceuticals in April 2025, are intended to accelerate multiple late-stage cancer therapies, including U.S. clinical trials across four indications, manufacturing scale-up, and commercialization efforts. For investors, the "so what" of these technological advancements and strategic moves is clear: Alpha Tau is building a competitive moat through its differentiated approach, aiming for superior clinical outcomes that could translate into strong market adoption, premium pricing, and a significant long-term growth trajectory in specialized oncology markets.

Financial Performance and Strategic Capitalization

As a clinical-stage biotechnology company, Alpha Tau Medical's financial profile reflects its intensive investment in research and development rather than commercial revenue generation. The company reported no operating revenue for 2024, 2023, 2022, or 2021. This is typical for firms in this phase, where significant capital is deployed to advance clinical programs.

Alpha Tau has consistently incurred net losses, with a net income of -31.75 million in 2024, -29.16 million in 2023, -33.76 million in 2022, and -27.27 million in 2021. The trailing twelve months (TTM) net income stands at -35.20 million. These losses are primarily driven by substantial operating expenses, particularly in research and development. R&D expenditures have steadily increased, from 11.45 million in 2021 to 27.02 million in 2024, underscoring the company's commitment to advancing its Alpha DaRT technology through various clinical stages.

Cash flow from operations has also been consistently negative, with -19.78 million in 2024, -17.96 million in 2023, -23.88 million in 2022, and -11.81 million in 2021. This further highlights the capital-intensive nature of drug and device development. However, Alpha Tau's liquidity position was significantly strengthened by the $36.9 million registered direct offering that closed on April 28, 2025. This capital infusion, which saw Oramed Pharmaceuticals acquire over 14 million ordinary shares, substantially boosted the company's cash reserves. As of the trailing twelve months, Alpha Tau reported total cash of 79.70 million. The company's current ratio of 10.52 and quick ratio of 9.77 indicate a robust short-term liquidity position, providing ample resources to fund ongoing clinical trials and operational needs.

Total debt remains relatively low at 13.31 million, with a debt-to-equity ratio of 0.15, suggesting a healthy balance sheet for a company at its stage of development.

Outlook and Strategic Trajectory

Alpha Tau's outlook is intrinsically tied to the successful progression of its clinical pipeline and the eventual commercialization of Alpha DaRT. While specific quantitative financial guidance is not publicly available, management's commentary provides clear strategic direction. CEO Uzi Sofer emphasized the urgent need for innovation in pancreatic cancer, stating that the IMPACT trial is a "key part of our broader strategy to bring Alpha DaRT to cancer patients with some of the highest unmet needs." This highlights the company's focus on indications with significant unmet medical needs, where Alpha DaRT's unique properties could offer substantial clinical benefits.

Chief Medical Officer Dr. Robert Den further articulated the company's commitment to generating "high-quality clinical data on safety and early efficacy to inform our future development path." The ultimate goal is to "offer patients a localized treatment option with the potential to enhance both local control and overall outcomes." This forward-looking perspective underscores a clear technological roadmap centered on rigorous clinical validation and strategic expansion into challenging solid tumor types. The partnership with Oramed Pharmaceuticals is a critical enabler, providing not only capital but also a strategic alliance aimed at accelerating U.S. clinical trials across four indications, manufacturing scale-up, and commercialization efforts. This collaboration is designed to expedite Alpha Tau's journey from clinical development to market presence, leveraging Oramed's expertise to potentially streamline the path to patients.

Risks and Competitive Landscape

Investing in Alpha Tau Medical, like any clinical-stage biotechnology company, involves inherent risks. A primary concern is the ability to receive regulatory approval for its Alpha DaRT technology. The company's limited operating history and consistent losses to date underscore its dependence on the successful commercialization of Alpha DaRT. There is also the risk that preliminary data from clinical studies, however promising, may not predict final study results, or that early-stage studies may not accurately forecast outcomes in later, larger trials. Challenges in patient enrollment for clinical trials, the potential for undesirable side effects, and exposure to patent infringement lawsuits are also significant considerations.

In the competitive landscape, Alpha Tau faces formidable rivals. While its Alpha DaRT technology offers a differentiated approach with its precision alpha-emitter delivery, established players like Accuray (ARAY) and Elekta (EKTAY) possess significantly larger commercial footprints, broader product portfolios, and more mature revenue streams. Accuray, for instance, has demonstrated consistent revenue growth in its core radiation therapy segment, driven by an established global installed base. Elekta also boasts robust revenue growth from its advanced radiation oncology systems and extensive clinical partnerships. Bayer (BAYRY), with its radiopharmaceuticals, represents another competitor in targeted therapies, backed by a vast R&D pipeline and global distribution.

Alpha Tau's competitive advantages lie in its proprietary Alpha DaRT technology, which offers unique benefits in terms of precision, reduced invasiveness, and the potential for systemic response. Its regulatory licenses for global trials also provide a strategic advantage. However, Alpha Tau's smaller scale and high R&D dependency make it vulnerable to higher costs and weaker cash flow compared to its more established peers. Supply chain dependencies for specialized components could also impact operational costs and profitability. Despite these challenges, the high barriers to entry in oncology therapeutics, including substantial R&D costs and stringent regulatory hurdles, help protect Alpha Tau's innovative position by limiting new entrants. The company's strategic focus on high-unmet-need cancers and its partnership with Oramed are crucial responses to these competitive forces, aiming to accelerate its path to market and establish a strong foothold in specialized oncology segments.

Conclusion

Alpha Tau Medical represents a compelling, albeit high-risk, investment opportunity centered on its groundbreaking Alpha DaRT technology. The company's innovative approach to delivering highly targeted alpha radiation directly to solid tumors addresses a critical need in oncology, particularly for challenging indications like pancreatic cancer and glioblastoma. Significant clinical progress, highlighted by promising interim data and the initiation of the U.S. IMPACT trial, underscores the potential of this platform.

While Alpha Tau remains a pre-revenue, R&D-intensive enterprise with a history of net losses, the recent $36.9 million capital infusion and strategic alliance with Oramed Pharmaceuticals (ORMP) have substantially strengthened its financial position and accelerated its development roadmap. The company's technological differentiation, offering precision, minimal invasiveness, and potential for systemic anti-tumor effects, provides a strong competitive moat against established players. The investment thesis hinges on Alpha Tau's ability to successfully navigate the remaining clinical development and regulatory pathways, translating its technological leadership into commercial success and ultimately delivering on its mission to provide curative technologies for cancer patients with the highest unmet needs.