Protagenic Therapeutics, Inc. (NASDAQ:PTIX), a pharmaceutical company, has received a notification from Nasdaq stating that it no longer meets the minimum stockholders' equity requirement for continued listing. The company, which was already on notice since May 22, 2024, was unable to regain compliance before the end of the granted extension period on November 18, 2024.
The Nasdaq Listing Qualifications department requires listed companies to maintain a minimum stockholders' equity of $2,500,000. Protagenic Therapeutics submitted a plan to regain compliance by the July 8, 2024 deadline, and Nasdaq granted an extension. However, the company did not meet the terms of the extension.
On November 19, 2024, Protagenic Therapeutics was informed that its common stock would be suspended from trading at the opening of business on November 29, 2024, and that a Form 25-NSE would be filed with the Securities and Exchange Commission, leading to the removal of the company's common stock from Nasdaq listing and registration.
The company has the option to appeal the delisting determination by requesting a hearing with the Nasdaq Hearings Panel. If requested, this action is expected to delay the delisting process until the conclusion of the hearing and any further extensions granted by the Panel. However, there is no guarantee that the Panel will grant an additional extension or that Protagenic Therapeutics will be able to regain compliance with the Nasdaq's listing requirements.
This development comes as a significant challenge for Protagenic Therapeutics, which operates under the pharmaceutical preparations industry classification and is headquartered in New York, NY. The company's stock, including its common stock warrants (NASDAQ:PTIXW), had been trading on the Nasdaq exchange before this notice.
In other recent news, Protagenic Therapeutics, Inc. has announced a private placement agreement with an expectation to raise approximately $1.275 million. This transaction involves the sale of shares and series A and B common stock purchase warrants, with Brookline Capital Markets acting as the sole placement agent. The company has stated that the net proceeds from this sale will be allocated for working capital purposes.
In addition to this, Protagenic Therapeutics has shared updates on the clinical development milestones for its drug candidate PT00114. The company plans to commence the multiple dose portion of the Phase I study for PT00114 in the fourth quarter of 2024, with results expected by the second quarter of 2025. The initiation of the Phase IIa study is scheduled for the third quarter of 2025.
However, the company has also received a warning from Nasdaq about a potential delisting due to its inability to meet the minimum bid price requirement for continued listing. Protagenic Therapeutics has been granted a 180-day period to regain compliance with this rule.
InvestingPro Insights
The recent notification from Nasdaq regarding Protagenic Therapeutics' (NASDAQ:PTIX) potential delisting aligns with several concerning financial indicators highlighted by InvestingPro. The company's market capitalization stands at a mere $2.86 million, significantly below Nasdaq's minimum stockholders' equity requirement of $2.5 million. This precarious financial position is further underscored by InvestingPro Tips, which reveal that PTIX is "quickly burning through cash" and "not profitable over the last twelve months."
The company's financial struggles are evident in its operating metrics, with an adjusted operating income of -$5.27 million for the last twelve months as of Q3 2024. Additionally, the basic EPS from continuing operations stands at -$1.27, indicating substantial losses. These figures support another InvestingPro Tip that "analysts do not anticipate the company will be profitable this year."
PTIX's stock performance has been equally troubling, with InvestingPro data showing a six-month price total return of -66.21% as of the most recent data. This aligns with the InvestingPro Tip that the "stock has taken a big hit over the last six months," reflecting investor concerns about the company's future.
For investors seeking a more comprehensive analysis, InvestingPro offers 8 additional tips for PTIX, providing deeper insights into the company's financial health and market position.
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