NEW YORK - Biodexa Pharmaceuticals PLC (NASDAQ:BDRX), a clinical stage biopharmaceutical company, today announced a change in the ratio of its American Depositary Receipts (ADR) in an effort to comply with Nasdaq's minimum bid price requirement. The company's ADRs will be adjusted from representing four hundred ordinary shares each to ten thousand ordinary shares per ADR.
The adjustment, effectively a reverse split for ADR holders, is scheduled to take place on October 4, 2024. This means that for every twenty-five existing ADRs, shareholders will receive one new ADR. The new CUSIP number for the ADRs will be 59564R807, replacing the old CUSIP number 59564R708. No fractional ADRs will be issued; instead, fractional shares will be sold and the proceeds distributed to the entitled ADR holders.
JP Morgan Chase (NYSE:JPM) Bank, N.A., serving as the Company's Depositary, will oversee the exchange process. ADR holders will be required to surrender their current ADRs for cancellation to receive the new ADRs. The ordinary shares of Biodexa will remain unaffected by this change.
The ratio adjustment is aimed at bringing Biodexa's ADRs into compliance with the Nasdaq's $1.00 minimum bid price per share requirement. However, the company has stated it cannot assure that the ratio change will achieve this goal.
This announcement contains forward-looking statements, which are based on current economic data and management's expectations for future events. Biodexa cautions that actual results could differ materially from those projected in any forward-looking statements due to various known and unknown risks and uncertainties. The company emphasizes that these statements are valid as of the date of the announcement and that it is under no obligation to update or revise any forward-looking statements unless required by law.
The information in this article is based on a press release statement from Biodexa Pharmaceuticals PLC.
In other recent news, Biodexa Pharmaceuticals has made significant strides in its ongoing research and development efforts. The company has successfully unlocked the remaining funds from a $17 million grant awarded by the Cancer Prevention and Research Institute of Texas (CPRIT) to support the Phase 3 study of its drug eRapa for Familial Adenomatous Polyposis (FAP). This comes after Biodexa completed its final match payment, marking a crucial step in its pursuit of new therapeutic options for FAP patients.
In addition to this, Biodexa has announced a $5.0 million registered direct offering and concurrent private placement, with Ladenburg Thalmann & Co. Inc. serving as the sole placement agent. The funds raised will further support the company's development programs, including the aforementioned Phase 3 clinical trial for eRapa. The offering is expected to close around July 22, 2024, pending customary closing conditions.
On the clinical front, Biodexa reported positive results from a Phase 2 trial for eRapa, showing a significant reduction in polyp burden among FAP patients. This suggests that eRapa could potentially reduce the need for surgical interventions and improve patients' quality of life. The Phase 3 trial, which is set to begin enrollment early next year, is expected to involve approximately 140 high-risk FAP patients. These are just a few of the recent developments in Biodexa's continued efforts to address diseases with unmet medical needs.
InvestingPro Insights
In light of Biodexa Pharmaceuticals PLC's recent announcement regarding the adjustment of its ADR ratio, a close examination of the company's financial health and stock performance metrics from InvestingPro offers valuable insights. With a current market capitalization of just $5.41 million, Biodexa's financial position appears precarious, especially considering its significant revenue decline of 45.49% over the last twelve months as of Q4 2023. This contraction in revenue is further highlighted by a quarterly drop of 64.07% in Q4 2023.
InvestingPro Tips suggest that Biodexa holds more cash than debt on its balance sheet, which could provide some financial flexibility. However, the company is also quickly burning through its cash reserves, and analysts expect both a sales decline and a net income drop in the current year. These factors, combined with the lack of profitability over the last twelve months and a forecast that the company will not be profitable this year, paint a challenging picture for Biodexa's financial future.
The stock's performance reinforces these concerns, with the price having fallen significantly, showing a 93.51% decline over the past year. The Relative Strength Index (RSI) suggests that Biodexa's stock is currently in oversold territory, which could indicate a potential reversal or at least a pause in the downward trend, yet this is a technical indicator that requires careful consideration alongside broader financial health.
With these insights in mind, investors and potential shareholders may want to explore the full range of 15 InvestingPro Tips available for Biodexa at https://www.investing.com/pro/BDRX, which provide a deeper analysis of the company's stock and financial performance. These tips could help inform investment decisions in the context of the company's strategic moves, such as the ADR ratio adjustment.
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