Plus Therapeutics (NASDAQ:PSTV), Inc., a medical device company, has been notified by The Nasdaq Stock Market that it fails to meet the minimum stockholders' equity requirement for continued listing on The Nasdaq Capital Market. The Austin, Texas-based company, trading under the ticker NASDAQ:PSTV, disclosed in its Form 10-K for the year ended December 31, 2023, a stockholders' equity deficit of $1,348,000 as of the end of the fiscal year.
The Nasdaq Listing Rule 5550(b)(1) requires a minimum of $2.5 million in stockholders' equity, or alternatively, a market value of listed securities of $35 million or net income from continuing operations of $500,000 in the most recently completed fiscal year or in two of the last three fiscal years. Plus Therapeutics failed to meet these criteria as of March 8, 2024.
After receiving the initial notice on March 8, 2024, Plus Therapeutics submitted a plan on April 22, 2024, to regain compliance. However, on Thursday, the company received a subsequent letter from Nasdaq indicating that it had not achieved compliance. The company intends to appeal this determination, which will stay any suspension or delisting action until the Hearings Panel's decision and any extension period granted post-hearing.
In other recent news, Plus Therapeutics disclosed a Q2 revenue of $1.3 million, falling short of the anticipated $1.6 to $1.7 million range, leading Ascendiant Capital to revise its 2024 revenue estimates for the company from $7 million to $5 million.
The company also reported an EPS of $(0.71), with a net loss of $7.6 million, which was not in line with the estimated $(0.37) and consensus of $(0.53). Ascendiant Capital suggests that the current quarterly cash burn rate of approximately $3 million could be a plausible near-term expectation.
At the company's annual meeting, shareholders elected six members to the Board of Directors and approved the fourth amendment and restatement of the company's 2020 Stock Incentive Plan. Plus Therapeutics also announced the results of its ReSPECT-LM trial, showing that rhenium obisbemeda was safe and well-tolerated.
The company reported a solid financial position with a cash and investments balance of $8.4 million and anticipated grant revenue of $6 million to $7 million for the year. Plus Therapeutics secured a $3 million award from the U.S. Department of Defense for a pediatric brain cancer trial and plans to complete enrollment for a potential pivotal trial by the end of 2024 or early 2025.
InvestingPro Insights
As Plus Therapeutics, Inc. faces challenges with Nasdaq's listing requirements, a closer look at the company's financial health through InvestingPro data reveals additional context. With a market capitalization of merely $8.02 million, the company's financial position is precarious. Notably, Plus Therapeutics holds more cash than debt on its balance sheet, which could be a silver lining in its current situation. However, the company is quickly burning through its cash reserves, which raises concerns about its long-term viability.
InvestingPro Tips suggest that Plus Therapeutics has been suffering from weak gross profit margins, with a reported gross profit margin of -96.46% over the last twelve months as of Q2 2024. This is consistent with the company's negative operating income margin of -256.04%. Analysts have also revised their earnings downwards for the upcoming period, and they do not anticipate the company will be profitable this year. These factors underscore the challenges the company faces in regaining compliance with Nasdaq's listing requirements.
Investors considering Plus Therapeutics should note that the company's price has significantly fallen over the last three months, with a 44.56% decrease in total return. For those interested in a deeper analysis, there are over 11 additional InvestingPro Tips available, which can provide further insights into the company's performance and outlook. Find these at https://www.investing.com/pro/PSTV.
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