BOSTON - TransCode Therapeutics, Inc. (NASDAQ:RNAZ), a clinical-stage oncology company, announced today that its Board of Directors has approved a 1-for-33 reverse stock split. The decision, made to satisfy Nasdaq's minimum bid price requirement for continued listing, follows approval from the company's stockholders on November 22, 2024.
The reverse stock split will reduce the number of outstanding common shares from approximately 17.3 million to around 523,202. This move is expected to raise the per-share trading price of TransCode's stock on the Nasdaq Capital Market. The company has stated that no fractional shares will be issued; stockholders who would receive fractional shares will instead be rounded up to the nearest whole number.
Alongside the reduction in shares, proportional adjustments will be made to the exercise prices of outstanding stock options and warrants, as well as to the number of shares issued and issuable under the company's stock incentive plans. Vstock Transfer LLC is set to act as the exchange agent for the reverse stock split.
Stockholders of record will not need to take any action to receive their post-split shares in book-entry form. Those holding shares through banks, brokers, custodians, or other nominees will see their positions automatically adjusted, although the processes may vary by entity.
The exact effective date of the reverse stock split has not yet been announced; however, the company will provide at least two business days' notice prior to its implementation.
TransCode Therapeutics is focused on advancing RNA therapeutics for cancer treatment, with its lead candidate, TTX-MC138, targeting metastatic tumors expressing microRNA-10b. The company is also developing other RNA therapeutic candidates aimed at addressing various cancers.
This news is based on a press release statement and contains forward-looking statements that involve risks and uncertainties. These statements are not guarantees of future performance, and actual results could differ materially. The company's future plans are subject to various factors, including regulatory approvals and market conditions.
In other recent news, TransCode Therapeutics continues to make significant strides in its oncology-focused endeavors. The company's lead therapeutic candidate, TTX-MC138, has progressed to the next stage of its Phase 1 cancer trial, following unanimous approval by the Safety Review Committee. This development was backed by a $2 million grant from the National Institutes of Health. Furthermore, a recent study in collaboration with Michigan State University has indicated that TTX-MC138 may reduce the ability of tumor cells to self-renew, a key factor in metastatic breast cancer.
TransCode is also navigating through regulatory challenges as it faces potential delisting from Nasdaq due to non-compliance with minimum bid price and equity requirements. Following a hearing with the Nasdaq Hearings Panel, the company has been granted conditional continued listing, contingent on meeting specific conditions within a set timeframe.
Despite these challenges, TransCode has announced plans for a public stock offering, with ThinkEquity acting as the sole placement agent. Analyst firm H.C. Wainwright has maintained a Buy rating on the company's shares, reflecting confidence in the ongoing development of TTX-MC138. These recent developments underscore TransCode's commitment to advancing its drug development program while navigating regulatory challenges.
InvestingPro Insights
TransCode Therapeutics' decision to implement a reverse stock split comes amid challenging financial circumstances, as revealed by recent InvestingPro data. The company's market capitalization stands at a modest $6.64 million, reflecting its current position in the biotech sector.
InvestingPro Tips highlight that TransCode is "quickly burning through cash" and "not profitable over the last twelve months." These factors likely contributed to the need for the reverse stock split to maintain Nasdaq listing requirements. The company's operating income for the last twelve months was -$14.65 million, underscoring the financial pressures it faces as it advances its RNA therapeutics pipeline.
Despite these challenges, TransCode has shown a "significant return over the last week," with a 16.52% price increase. However, this short-term gain is overshadowed by longer-term performance issues, as the stock has "fallen significantly over the last year," with a -95.99% total return over the past 12 months.
Investors should note that TransCode "holds more cash than debt on its balance sheet," which could provide some financial flexibility as it navigates this critical period. The company's focus on developing innovative cancer treatments, particularly its lead candidate TTX-MC138, may offer potential for future growth if clinical trials prove successful.
For a more comprehensive analysis, InvestingPro offers 14 additional tips for TransCode Therapeutics, providing deeper insights into the company's financial health and market position.
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