JERUSALEM - Scinai Immunotherapeutics Ltd. (NASDAQ:SCNI), a biopharmaceutical company, announced its financial results for the first quarter ended March 31, 2024, along with a business update. The company, which specializes in developing inflammation and immunology biological products and offers CDMO services, raised $1.69 million in early January through warrant exercises and new issuances.
Scinai has regained compliance with Nasdaq's minimum bid price requirement but is still working to meet the equity requirement.
The company presented a plan to the Nasdaq Hearing Panel on June 18, 2024, which includes a debt-to-equity loan restructuring deal with the European Investment Bank (EIB). A letter of intent from the EIB indicates a conversion of the EIB's loan into equity, with a binding term sheet expected in July and the amendment of the financial contract by the end of August.
The company's CDMO business unit has received work orders worth around $500K in the first half of 2024 and is in discussions with several potential clients. Scinai maintains its sales guidance for the year at $1.25 million and anticipates significant revenue growth in the coming years. Marketing efforts have included participation in major pharmaceutical conferences and targeted campaigns.
Scinai is advancing the preclinical development of its NanoAb pipeline, including promising studies for the treatment of plaque psoriasis. It also met with Germany’s Paul Erlich Institute for scientific advice, which will guide the upcoming pre-clinical toxicology study and a clinical trial planned for 2025.
Financially, the company reported a net loss of $2,159 thousand for Q1 2024, a decrease from the previous year's net loss of $3,515 thousand. Research and development expenses decreased primarily due to reduced salaries and subcontractor use. Marketing, general, and administrative expenses also decreased, attributed to reductions in salaries, share-based compensation, and professional services.
As of March 31, 2024, Scinai had cash and cash equivalents and short-term deposits totaling $4,826 thousand, slightly less than the $4,870 thousand reported at the same time in 2023.
This article is based on a press release statement from Scinai Immunotherapeutics Ltd.
In other recent news, Scinai Immunotherapeutics Ltd. still faces an equity shortfall, violating Nasdaq's minimum shareholders' equity requirement. In a significant development, Scinai has received a non-binding Letter of Intent from the European Investment Bank (EIB) proposing to convert approximately $27.6 million of EIB's loan into equity. This conversion is expected to rectify the company's shareholders' deficit, creating an estimated equity surplus of around $14.5 million.
The implementation of these terms is contingent upon formal approval from EIB's governing bodies and satisfaction of conditions precedent.
InvestingPro Insights
Scinai Immunotherapeutics Ltd. (NASDAQ:SCNI) has been navigating through challenging financial waters, as reflected in the company's recent market performance and fundamental metrics. The company's market capitalization stands relatively low at $1.37 million, which is indicative of its current financial scale and investor sentiment. Meanwhile, the negative price-to-earnings (P/E) ratios, both standard and adjusted for the last twelve months as of Q4 2023, underscore a lack of profitability, with figures of -0.18 and -0.21 respectively. Additionally, the company's stock price has experienced significant volatility, with a 1-month price total return of -21.6%, and a steep 1-year price total return of -79.15%, reflecting the market's reaction to its financial health and future prospects.
An InvestingPro Tip highlights that Scinai operates with a significant debt burden, which is a critical factor for investors to consider, especially in light of the company's ongoing restructuring efforts with the European Investment Bank. Furthermore, Scinai's cash burn rate is a point of concern, as indicated by another InvestingPro Tip, suggesting that the company is quickly depleting its financial reserves. These insights are particularly relevant for investors who are monitoring the company's ability to sustain operations and finance its research and development initiatives.
For readers who are looking for a deeper analysis and additional insights on Scinai Immunotherapeutics Ltd., InvestingPro offers a comprehensive list of tips that can help investors make informed decisions. There are 13 additional InvestingPro Tips available at https://www.investing.com/pro/SCNI, providing a more granular look at the company's financial health and stock performance. To access these valuable insights, use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription.
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