Nasdaq Determines TransCode Therapeutics Compliance with Minimum Stockholders’ Equity Requirement and Continued Listing on The Nasdaq Stock Market
- None.
- The company's non-compliance with the minimum bid price rule poses a risk of potential delisting from the Nasdaq if not rectified within the specified timeframe.
Insights
TransCode Therapeutics' recent compliance with Nasdaq's minimum stockholders’ equity requirement is a significant development for the company's financial stability and investor confidence. Historically, companies meeting such requirements often see improved perceptions among investors, which can lead to increased stock liquidity and access to capital markets. However, the mandatory panel monitor imposed until January 2025 implies a period of heightened scrutiny, which could pressure the company to maintain strict financial discipline. The inability to present a new plan of compliance if found non-compliant again within the monitoring period means that the stakes are high for TransCode to adhere to Nasdaq's regulations.
Furthermore, the looming challenge of meeting the minimum bid price requirement poses a risk of volatility in the company's stock price. Achieving a closing bid price of $1.00 or more for at least 10 consecutive trading days is critical for continued listing and avoiding potential delisting procedures. Investors should monitor the company's stock performance closely as the May 6, 2024, deadline approaches. If the company fails to meet this requirement, the possibility of an additional 180-day compliance period offers a temporary reprieve, yet it underscores the need for the company to address underlying issues that may be affecting its stock price.
TransCode Therapeutics' operational focus on RNA therapeutics for cancer treatment places it within a highly specialized and competitive segment of the biotechnology industry. The company's ability to maintain Nasdaq listing can impact its competitive positioning, as it affects not just capital raising capabilities but also partnership opportunities. Biotech firms often rely on a strong stock performance to forge collaborations and licensing deals, which are crucial for advancing clinical trials and bringing new therapies to market.
Investors should consider the broader industry context where RNA-based therapies are gaining traction, driven by scientific advancements and successful market entries. TransCode's compliance with Nasdaq's Equity Rule may enhance its ability to capitalize on these trends. Yet, the requirement to maintain a minimum bid price is a common challenge for biotech companies, where stock prices can be highly sensitive to clinical trial outcomes and regulatory news. The company's strategic moves in the coming months, including potential capital raising efforts or strategic partnerships, will be pivotal in addressing this challenge and sustaining investor interest.
From a legal and regulatory standpoint, TransCode Therapeutics' situation highlights the stringent requirements that companies face when listed on major stock exchanges like Nasdaq. Compliance with the Equity Rule is a testament to the company's ability to meet financial governance standards, which is crucial for investor protection. However, the strict stipulations set by Nasdaq, particularly the condition that precludes the company from proposing a new compliance plan if it falls short again, underscores the rigidity of the regulatory framework within which public companies operate.
Investors should be aware of the legal implications of a potential delisting, which may include reduced marketability of the shares and diminished shareholder value. The company's right to a hearing if a Delist Determination Letter is issued ensures due process, yet the outcome of such proceedings can be uncertain. It is imperative for the company to not only meet but maintain the set standards to avoid legal complexities and ensure uninterrupted listing, which facilitates both trading and regulatory compliance.
BOSTON, Jan. 31, 2024 (GLOBE NEWSWIRE) -- TransCode Therapeutics, Inc. (Nasdaq: RNAZ), (the “Company”), an RNA oncology company committed to more effectively treating cancer using RNA therapeutics, today announced that it has received notice from the NASDAQ Stock Market LLC (Nasdaq) that the Nasdaq has determined that the Company has regained compliance with the minimum stockholders’ equity requirement under Nasdaq Listing Rule 5550(b)(1) (the Equity Rule) for continued listing on the Nasdaq Capital Market. Pursuant to Nasdaq Listing Rule 5815(d)(4)(B), the Company will be subject to a mandatory panel monitor through January 26, 2025.
The Nasdaq notice also stated that if, within the one-year monitoring period, the Nasdaq Staff finds the Company is again out of compliance with the Equity Rule that was the subject of the exception, notwithstanding Rule 5810(c)(2), the Company will not be permitted to provide the Staff with a plan of compliance with respect to that deficiency and the Staff will not be permitted to grant additional time for the Company to regain compliance with respect to that deficiency, nor will the Company be afforded an applicable cure or compliance period pursuant to Rule 5810(c)(3). Instead, the Staff will issue a Delist Determination Letter and the Company will have an opportunity to request a new hearing with the initial Hearing Panel or a newly convened Hearing Panel if the initial Panel is unavailable. The Company will have the opportunity to respond/present to the Hearing Panel as provided by Listing Rule 5815(d)(4)(C). The Company’s securities may be at that time delisted from Nasdaq.
Separately, TransCode was notified by Nasdaq on November 7, 2023, that it was not in compliance with Nasdaq Listing Rule 5550(a)(2), the minimum bid price rule, because the closing bid price of its common stock failed to meet the
About TransCode Therapeutics
TransCode is a clinical-stage oncology company focused on treating metastatic disease. The company is committed to defeating cancer through the intelligent design and effective delivery of RNA therapeutics based on its proprietary TTX nanoparticle platform. The company’s lead therapeutic candidate, TTX-MC138, is focused on treating metastatic tumors which overexpress microRNA-10b, a unique, well-documented biomarker of metastasis. In addition, TransCode is developing a portfolio of first-in-class RNA therapeutic candidates designed to overcome the challenges of RNA delivery and thus unlock therapeutic access to a variety of novel genetic targets that could be relevant to treating a variety of cancers.
For more information, please visit www.transcodetherapeutics.com.
Forward-Looking Statements
This release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, statements concerning the continued listing of the Company’s stock on the Nasdaq Capital Market. Any forward-looking statements in this press release are based on management’s current expectations of future events and are subject to a number of risks and uncertainties that could cause actual results to differ materially and adversely from those set forth in or implied by such forward-looking statements. These risks and uncertainties include, but are not limited to: risks associated with drug discovery and development; risks that the results of clinical trials we conduct will not be consistent with our pre-clinical studies or expectations; risks associated with the timing and outcome of TransCode’s planned regulatory submissions; risks associated with TransCode’s planned clinical trials for its product candidates; risks associated with obtaining, maintaining and protecting intellectual property; risks associated with TransCode’s ability to enforce its patents against infringers and defend its patent portfolio against challenges from third parties; risks of competition from other companies developing products for similar uses; risks associated with TransCode’s financial condition and its need to obtain additional funding to support its business activities, including TransCode’s ability to continue as a going concern; risks associated with TransCode’s dependence on third parties; and risks associated with the COVID-19 coronavirus and geopolitical events. For a discussion of these and other risks and uncertainties, and other important factors, any of which could cause TransCode’s actual results to differ from those contained in or implied by the forward-looking statements, see the section entitled “Risk Factors” in TransCode’s Annual Report on Form 10-K for the year ended December 31, 2022, as well as discussions of potential risks, uncertainties and other important factors in any subsequent TransCode filings with the Securities and Exchange Commission. All information in this press release is as of the date of the release; TransCode undertakes no duty to update this information unless required by law.
For more information, please contact:
Tom Fitzgerald, Interim CEO; CFO
tom.fitzgerald@transcodetherapeutics.com
FAQ
What is the ticker symbol for TransCode Therapeutics, Inc.?
What is the minimum bid price requirement for Nasdaq compliance?
What is the compliance period for regaining minimum bid price requirement?
What happens if TransCode Therapeutics, Inc. does not regain compliance with the minimum bid price requirement?
What is the consequence of non-compliance with the minimum bid price rule?
