Mustang Bio (NASDAQ:MBIO), Inc., a biopharmaceutical company, has received a formal notice from the Nasdaq Stock Market indicating its securities are subject to delisting due to non-compliance with the stockholders' equity requirement. The company was unable to meet the minimum $2.5 million stockholders' equity threshold by the September 9, 2024, deadline, as set by Nasdaq Listing Rule 5550(b).
The notice, dated Monday, September 10, 2024, allows Mustang Bio to request a hearing before the Nasdaq Hearings Panel to appeal the delisting decision. The company has indicated its intention to do so, which will temporarily stay the delisting process pending the outcome of the hearing and any granted extension period.
Mustang Bio's common stock, traded under the ticker symbol MBIO on the Nasdaq Capital Market, will continue to be listed and trade as usual during the appeal process. The company is exploring all possible avenues to regain compliance but has cautioned that there is no guarantee the Panel will permit continued listing on the Nasdaq or that the company will manage to demonstrate compliance within any extension period that may be offered.
In other recent news, Mustang Bio, a clinical-stage biopharmaceutical company, announced a registered direct offering and concurrent private placement of common stock and warrants, projected to generate gross proceeds of approximately $2.5 million.
The company plans to issue 6,130,000 shares of common stock or equivalents at $0.41 per share, along with an equal number of unregistered warrants, exercisable at the same price. The proceeds will be used for general corporate purposes and working capital.
In another development, Mustang Bio reported a 90% response rate in its Phase 1/2 clinical trial of MB-106, a CD20-targeted CAR T-cell therapy for Waldenstrom macroglobulinemia, a rare blood cancer. The successful trial outcome depends on securing additional funding or establishing strategic partnerships.
Meanwhile, H.C. Wainwright has substantially increased its stock target for Fortress Biotech (NASDAQ:FBIO), Mustang Bio's founding company, from $10.00 to $24.00, indicating a positive outlook. Roth/MKM maintained a Buy rating on Fortress Biotech stock, noting the company's 2023 revenue of $84.5 million, up from $75.7 million in 2022.
Despite a reduced revenue forecast for 2024, the firm expects a significant revenue increase in 2025, largely driven by Journey Medical's DFD-29 and Checkpoint Therapeutics (NASDAQ:CKPT)' Cosibelimab.
InvestingPro Insights
As Mustang Bio, Inc. (MBIO) faces the challenges of meeting Nasdaq's stockholders' equity requirements, a closer look at the company's financial health and market performance is crucial for investors. According to InvestingPro data, Mustang Bio's market capitalization stands at a modest $9.96 million, reflecting the scale of the company in the biopharmaceutical industry. The company's Price to Earnings (P/E) ratio is currently negative at -0.11, indicating that the company is not generating net income currently. This is further supported by a negative EBITDA of -$30.5 million for the last twelve months as of Q2 2024, underscoring the company's challenges in achieving profitability.
InvestingPro Tips reveal that while Mustang Bio holds more cash than debt on its balance sheet, it is quickly burning through cash. Additionally, the company's stock price has experienced significant volatility, with a notable decline over the past week and month. These factors are critical for investors to consider, especially in light of the potential delisting from Nasdaq. For those looking to delve deeper into Mustang Bio's financials and market performance, InvestingPro offers a comprehensive suite of tips, with 17 additional insights available to help investors make informed decisions.
It's important for investors to monitor Mustang Bio's next steps as they navigate the appeal process with Nasdaq. With the company's recent stock performance and financial metrics in mind, stakeholders will need to weigh the potential risks and opportunities associated with Mustang Bio's efforts to regain compliance and maintain its market listing.
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