TransCode Therapeutics, Inc., a biopharmaceutical company, is confronting the risk of being delisted from The Nasdaq Capital Market due to non-compliance with Nasdaq's listing rules. The Boston-based company, which specializes in pharmaceutical preparations, received two deficiency notices from Nasdaq related to its stock performance and equity levels.
On August 13, 2024, TransCode was notified of its failure to maintain the minimum bid price of $1.00 per share over 30 days, a key requirement for continued listing. The company's common stock, traded under the ticker RNAZ, did not meet this standard from July 1 through August 12, 2024. Typically, a grace period of 180 days is provided to regain compliance, but due to prior reverse stock splits, TransCode is ineligible for this extension.
In a separate notice dated August 15, 2024, Nasdaq informed TransCode that it did not meet the minimum stockholders' equity requirement of $2.5 million. The company's financials showed stockholders' equity of $1,322,274 as of June 30, 2024. Although TransCode reported a pro forma stockholders' equity of approximately $3.7 million after a July equity offering, Nasdaq may not consider this on a pro forma basis.
Currently, the company also fails to meet alternative quantitative standards for listing, which include a market value of listed securities of $35 million or net income from continued operations.
TransCode has appealed Nasdaq's delisting decision, and the process has been stayed pending a final decision by the Nasdaq Hearings Panel. The panel is scheduled to review the company's appeal on October 1, 2024. However, there is no guarantee that the panel will grant an extension or that TransCode will regain compliance with listing requirements. Consequently, the future of TransCode's listing on The Nasdaq Capital Market remains uncertain.
The information for this report is based on a press release statement.
In other news, Transcode Therapeutics has made significant progress in its clinical trials, reporting promising results from its Phase 0 trial of TTX-MC138. This RNA-based cancer drug has shown potential anti-tumor activity and a significant reduction in the molecular target miRNA-10b. The company has also received FDA authorization to commence a Phase 1/2 clinical trial for TTX-MC138.
In the company's 2024 Annual Meeting of Stockholders, four directors were elected and an amendment to increase shares for issuance under the company's 2021 Stock Option and Incentive Plan was approved. However, a proposal for a reverse stock split was rejected by stockholders. These are some of the recent developments at Transcode Therapeutics.
InvestingPro Insights
As TransCode Therapeutics navigates the challenges of Nasdaq compliance, current InvestingPro data provides further context to the company's financial standing. With a Market Cap of just $4.77 million and a Price/Book ratio as of Q2 2024 at 3.6, the company's valuation reflects the intense pressures it faces. The stock's performance has been notably poor, with a staggering 99.58% drop in 1-year price total return and a 95.81% decline year-to-date, underscoring the urgency of the situation for investors.
Two key InvestingPro Tips highlight the company's precarious position: TransCode holds more cash than debt, which could be a glimmer of hope for liquidity. However, the RSI suggests the stock is in oversold territory, indicating a lack of investor confidence and potential undervaluation. With the company suffering from weak gross profit margins and not profitable over the last twelve months, these insights paint a picture of a firm struggling to maintain financial viability. TransCode does not pay a dividend, which may further deter income-focused investors. For those considering the stock, there are over a dozen additional InvestingPro Tips available at https://www.investing.com/pro/RNAZ, providing a comprehensive analysis for informed decision-making.
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