BOCA RATON, Fla. - Entero Therapeutics Inc. (NASDAQ: ENTO), a biopharmaceutical company focused on gastrointestinal diseases, has announced a binding letter of intent with Data Vault Holdings Inc. to license technology aimed at enhancing clinical trial compliance. The agreement, expected to close by the end of September 2024, will grant Entero Therapeutics an exclusive global license to use Data Vault's QOLPOM® and FotoDigm® software in its clinical trials, starting with a Phase 3 study for latiglutenase, a treatment for celiac disease.
The collaboration will involve Entero Therapeutics issuing convertible preferred stock to Data Vault and paying single-digit revenue sharing royalties on net sales. Entero Therapeutics is also seeking strategic investments totaling up to $3 million, with Data Vault's assistance, to fund the customization and application of the compliance software.
James Sapirstein, Chairman and CEO of Entero Therapeutics, expressed confidence in the software's potential to improve trial outcomes and its broader commercial applications. The software platforms, developed by the late Senator David Bradley, leverage machine learning, IoT, and machine vision technology to address challenges in remote patient monitoring and clinical trial data management.
Entero Therapeutics will be responsible for future clinical and commercial development and will have the right to out-license the technology within the biopharmaceutical field. The completion of the transaction is dependent on due diligence, definitive agreements, and securing the strategic investment on satisfactory terms.
This move is part of Entero Therapeutics' ongoing efforts to advance its clinical programs, which include other proprietary technologies for GI diseases. The company's strategic partnership with Data Vault Holdings is based on a press release statement and is subject to customary closing conditions and approvals.
In other recent news, Entero Therapeutics has seen several significant developments. The company has appointed Machias Gini & O’Connell LLP (MGO) as its new independent registered public accounting firm, a decision that came without any reported issues from previous fiscal years. Concurrently, there have been major changes in the company's leadership and board. Timothy R. Ramdeen has been appointed to the board of directors, while Dr. Jack Syage has transitioned from the role of Chief Operating Officer to Chief Scientific Officer.
In financial developments, Entero Therapeutics has secured approximately $1.1 million in a registered direct offering and concurrent private placement, managed by Roth Capital Partners. These funds are earmarked for general corporate purposes and working capital.
In the realm of analyst coverage, H.C. Wainwright reinstated its coverage on Entero Therapeutics, shifting their rating from Under Review to Neutral. This follows the company's recent acquisition of ImmunogenX, which has expanded its focus on advancing gastrointestinal treatments. These are among the recent developments for Entero Therapeutics.
InvestingPro Insights
In light of Entero Therapeutics Inc.'s (NASDAQ: ENTO) recent announcement regarding their strategic alliance with Data Vault Holdings, it's important for investors to consider the company's financial health and market performance. According to InvestingPro data, Entero Therapeutics has a market capitalization of just $1.3 million, underscoring its status as a micro-cap stock with potentially higher risk and volatility. This is reflected in the company's current Price / Book ratio, which stands at a low 0.08, suggesting that the stock is trading at a value less than its net asset value as of the last twelve months leading up to Q1 2024.
The company's operational performance has faced challenges, with an operating income adjusted for the last twelve months as of Q1 2024 at negative $20.93 million. Additionally, the company has not been profitable over the past year, with a substantial negative Return on Assets of -12.74% for the same period. This aligns with one of the InvestingPro Tips indicating that analysts do not expect the company to be profitable this year.
Despite these challenges, Entero Therapeutics has experienced a strong return over the last month, with a 68.28% price total return, which could be of interest to short-term investors or those looking for a potential turnaround story. However, with the stock having fallen significantly over the last year, down by 95.18%, it's clear that the company has been facing sustained market pressure.
For investors seeking a deeper dive into Entero Therapeutics' financials and market performance, there are additional InvestingPro Tips available. For instance, the stock's high price volatility and weak gross profit margins are factors that might influence investment decisions. In total, there are 13 additional tips listed on InvestingPro for Entero Therapeutics, providing a comprehensive analysis for those considering this stock. To explore these further, visit the dedicated InvestingPro page for Entero Therapeutics at https://www.investing.com/pro/ENTO.
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