ATLANTA - Dogwood Therapeutics, Inc. (NASDAQ:DWTX), a clinical-stage biopharmaceutical company, has announced it now complies with Nasdaq's minimum bid price requirement, effectively closing its previous listing compliance issue. The company, known until recently as Virios Therapeutics, Inc., is engaged in developing treatments for pain and fatigue-related disorders.
The announcement comes alongside news of the company's ongoing integration of Pharmagesic (Holdings) Inc., which it acquired in early October 2024. Dogwood Therapeutics is also expecting to release top-line results from a phase 2a study of its drug candidate IMC-2 for the treatment of Long-COVID by mid-November 2024.
Dogwood's research pipeline includes two mechanistic platforms: a non-opioid analgesic program and an antiviral program. Its lead non-opioid analgesic candidate, Halneuron®, is designed to block voltage-gated sodium channels, a method known to reduce pain. The company anticipates interim data from a Phase 2 study on chemotherapy-induced neuropathic pain (CINP) in the second half of 2025.
The antiviral program's IMC-1 and IMC-2 are fixed-dose combinations of nucleoside analog anti-herpes antivirals and the anti-inflammatory agent celecoxib. These are intended to treat illnesses associated with the reactivation of dormant herpes viruses, such as fibromyalgia and Long-COVID. IMC-1 is preparing to enter Phase 3 development as a treatment for fibromyalgia and is the subject of external partnership discussions.
Dogwood Therapeutics' forward-looking statements in the press release are subject to substantial risks and uncertainties, with the company acknowledging the inherent difficulties in predicting the completion, timing, and results of clinical studies. The company has advised that it does not intend to update forward-looking statements except as required by law.
The recent developments reflect Dogwood Therapeutics' efforts to advance its product candidates through clinical trials and its strategic expansion through acquisitions. Investors and stakeholders are directed to the company's website and social media channels for further information. This news is based on a press release statement from Dogwood Therapeutics, Inc.
In other recent news, Virios Therapeutics has unveiled significant developments, including a merger with Wex Pharmaceuticals, a subsidiary of CK Life Sciences, to form Dogwood Therapeutics. H.C. Wainwright responded to this development by raising its stock price target for Virios from $0.20 to $5.00, while maintaining a neutral rating. The merger will result in the advancement of three primary assets: Halneuron®, IMC-1, and IMC-2, which are being developed to treat various health conditions.
Additionally, Virios announced a 25-to-1 reverse stock split, which aims to align the company with Nasdaq listing requirements. Following the merger, Virios shareholders will represent about 6% of Dogwood Therapeutics, with CK Life Sciences holding the remaining 94%.
In terms of financing, an affiliate of CK Life Sciences has committed to providing a $19.5 million loan to the new entity. This funding is expected to support research and operations through significant milestones, such as the anticipated interim analysis of the Halneuron® Phase 2b study in late 2025.
Lastly, Virios shareholders will receive a contingent value right (CVR) tied to any future milestone payments for IMC-1 and IMC-2. These recent developments highlight the strategic moves and financial arrangements aimed at supporting the merged entity's operations in the near term.
InvestingPro Insights
Dogwood Therapeutics' recent compliance with Nasdaq's minimum bid price requirement comes amid a challenging financial landscape for the company. According to InvestingPro data, DWTX has experienced a significant 60.53% price decline over the past six months, reflecting the volatility mentioned in one of the InvestingPro Tips. This volatility aligns with the company's ongoing clinical trials and strategic changes, including the recent acquisition of Pharmagesic (Holdings) Inc.
Despite the recent stock performance, InvestingPro Tips highlight that Dogwood Therapeutics holds more cash than debt on its balance sheet and has liquid assets exceeding short-term obligations. These factors could provide some financial stability as the company progresses through its clinical trials and awaits key results, such as the upcoming top-line data from the IMC-2 Long-COVID study.
However, investors should note that DWTX is not currently profitable, with a negative P/E ratio of -1.27 for the last twelve months as of Q2 2024. This aligns with the InvestingPro Tip indicating that analysts do not anticipate the company to be profitable this year, which is not uncommon for clinical-stage biopharmaceutical companies investing heavily in research and development.
For those seeking a more comprehensive analysis, InvestingPro offers 10 additional tips for DWTX, providing deeper insights into the company's financial health and market position.
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