WALTHAM, MA - Xilio Therapeutics, Inc., a biopharmaceutical company, received a deficiency notice from the Nasdaq Stock Market on Monday, stating that the company's stock had not met the minimum bid price requirement for the last 30 consecutive business days.
The company's common stock closed below the required $1.00 per share, triggering a warning of potential delisting from the Nasdaq Global Select Market.
The notice does not immediately affect Xilio Therapeutics' stock listing. The company has 180 calendar days, until March 10, 2025, to regain compliance with the Nasdaq’s minimum bid price rule. To achieve this, the closing bid price of Xilio's common stock must reach or exceed $1.00 per share for at least 10 consecutive business days within this period.
If Xilio Therapeutics fails to meet the requirement in the given timeframe, it may be eligible for an additional 180-day compliance period by transferring its listing to the Nasdaq Capital Market. This is contingent upon the company meeting all other initial listing standards of the Nasdaq Capital Market, except for the minimum bid price.
Should the company be unable to remedy the deficiency or meet other listing standards during the second period, Nasdaq staff may initiate delisting procedures. Xilio would then have the option to appeal the decision to a Hearings Panel, with its stock remaining listed during the appeal process.
However, the outcome of such an appeal is uncertain, and there is no guarantee that the company will achieve compliance with the minimum bid price or other listing requirements.
Xilio Therapeutics has stated its intention to monitor its stock's closing bid price closely and to evaluate options to regain compliance with the Nasdaq's requirements. Despite these intentions, the company acknowledges that there is no assurance of regaining compliance with the minimum bid price rule.
In other recent news, Xilio Therapeutics reported a second-quarter net loss of $14 million, with cash reserves of $75 million, projected to last until 2025. The firm is focusing its clinical efforts on two significant trials, XTX101 and XTX301, with results expected later this year. TD Cowen reaffirmed its Buy rating on the company, signaling confidence in Xilio's clinical direction and potential of its pipeline candidates.
The company also announced the addition of Aoife Brennan, M.D., and James Shannon, M.D., to its board of directors, both recognized for their extensive experience in drug development. Recently, Xilio secured approximately $11.3 million through a private investment involving the sale of common stock and prefunded warrants, with Bain Capital Life Sciences and Rock Springs Capital among the investors.
In partnership with Gilead Sciences (NASDAQ:GILD), Xilio is advancing the XTX301 program, which includes a significant upfront payment and potential for additional payments based on milestones and sales. As part of recent developments, the company discontinued monotherapy development of XTX202 and is seeking collaborations for its advancement as a combination therapy.
Xilio is also implementing cost-saving measures, including a workforce reduction affecting approximately 21% of its employees, expected to incur one-time costs of around $1 million.
InvestingPro Insights
As Xilio Therapeutics faces the challenge of regaining compliance with Nasdaq's minimum bid price requirement, an analysis of real-time data and InvestingPro Tips can provide valuable context for investors monitoring the situation. According to InvestingPro data, Xilio Therapeutics currently has a market capitalization of $36.04 million, reflecting the scale of the company in the biopharmaceutical industry. Despite a challenging financial landscape, with a negative P/E ratio of -0.57 and an operating income margin of -2830.04%, the company maintains a strong cash position relative to its debt, as indicated by one of the InvestingPro Tips. Furthermore, the stock price has experienced significant volatility, often moving in the opposite direction of the market, and analysts do not expect the company to be profitable this year. Adding to the concerns, Xilio does not pay dividends, which may impact investor sentiment.
Investors should note that there are additional InvestingPro Tips available for Xilio Therapeutics, which can be accessed for more in-depth analysis and strategic insights. With the next earnings date slated for November 7, 2024, and the stock's current price hovering around $0.82, close attention to the company's performance and strategic initiatives will be crucial in the upcoming months. The InvestingPro platform offers a total of 6 tips for Xilio Therapeutics, providing a more comprehensive understanding of the company's financial health and market position.
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