Scilex Holding Company Announces that the Official Committee of Unsecured Creditors of Sorrento Therapeutics, Inc., has Filed a Motion with the U.S. Bankruptcy Court to Extend the Lockup Period on Shares of Scilex Stock Previously Distributed by Sorrento to its Stockholders as a Dividend from March 31, 2024 to September 30, 2024

Rhea-AI Summary

Scilex Holding Company (SCLX) announces extension of restrictions on transfer of its shares by Sorrento Therapeutics, Inc. Creditors' Committee files motion seeking extension from March 31, 2024, to September 30, 2024, subject to U.S. Bankruptcy Court approval.

Insights

Legal Expert

The request by the Creditors' Committee of Sorrento Therapeutics to extend the restrictions on the transfer of Scilex Holding Company's Dividend Stock is a significant legal maneuver within bankruptcy proceedings. This extension can affect the liquidity and marketability of Scilex's shares, potentially impacting shareholder value. Investors and shareholders must understand that such legal actions can lead to temporary halts in trading activity for the affected shares, which might influence the stock's volatility. Additionally, these restrictions can signal underlying financial distress or strategic reorganization efforts that could have long-term implications for the company's financial health and operational strategy.

Financial Analyst

An extension of transfer restrictions on dividend shares typically indicates a complex financial situation, possibly related to the restructuring efforts of Sorrento Therapeutics. For Scilex, this move could be interpreted by the market as a sign of instability, potentially affecting investor confidence and the stock price. It's important to assess the company's financial statements and cash flow to understand the potential impact of such restrictions on its liquidity and capital structure. The extension could also alter the timeline for any expected returns from these shares, which is a crucial factor for investors' portfolio strategies and valuation models.

Market Research Analyst

The implications of the motion to extend transfer restrictions on Scilex's Dividend Stock need to be evaluated in the context of the non-opioid pain management market. Scilex's focus on this sector is particularly relevant given the ongoing opioid crisis and the increasing demand for alternative pain treatments. This legal development might affect Scilex's ability to raise capital and invest in its product pipeline, which could impact its competitive position in the market. Understanding the market dynamics and Scilex's role within it will be essential to gauge the long-term commercial prospects of the company post-restriction period.

PALO ALTO, Calif., March 02, 2024 (GLOBE NEWSWIRE) -- Scilex Holding Company (Nasdaq: SCLX, “Scilex”), an innovative revenue-generating company focused on acquiring, developing and commercializing non-opioid pain management products for the treatment of acute and chronic pain, today announced that the Official Committee of Unsecured Creditors (the “Creditors’ Committee”) of Sorrento Therapeutics, Inc. (OTC: SRNEQ, “Sorrento”) has filed a motion (the “Motion”) with the U.S. Bankruptcy Court for the Southern District of Texas (the “Court”) seeking to further extend the restrictions on transfer on the shares of common stock of Scilex that were previously distributed by Sorrento to its stockholders as a dividend on January 19, 2023 (the “Dividend Stock”) from March 31, 2024 to September 30, 2024. Further notice related to the U.S. Bankruptcy Court’s decision on the Motion will be communicated once an order has been granted.

Accordingly, as described in the Motion, if the Court approves the Motion, any shares of the Dividend Stock (including any such shares held by brokerage firms) may not be sold, transferred or otherwise disposed of and the holders of Dividend Stock would be prohibited from causing or encouraging any third party to do the same. If approved, this extension shall apply only to the Dividend Stock and does not apply to any other outstanding securities of Scilex.

To review the Motion, please click the link here.

About Scilex Holding Company

Scilex Holding Company is an innovative revenue-generating company focused on acquiring, developing and commercializing non-opioid pain management products for the treatment of acute and chronic pain. Scilex targets indications with high unmet needs and large market opportunities with non-opioid therapies for the treatment of patients with acute and chronic pain and are dedicated to advancing and improving patient outcomes.    Scilex’s commercial products include: (i) ZTlido® (lidocaine topical system) 1.8%, a prescription lidocaine topical product approved by the U.S. Food and Drug Administration (the “FDA”) for the relief of neuropathic pain associated with postherpetic neuralgia, which is a form of post-shingles nerve pain; (ii) ELYXYB®, a potential first-line treatment and the only FDA-approved, ready-to-use oral solution for the acute treatment of migraine, with or without aura, in adults; and (iii) GLOPERBA®, the first and only liquid oral version of the anti-gout medicine colchicine indicated for the prophylaxis of painful gout flares in adults, expected to launch in 2024.

In addition, Scilex has three product candidates: (i) SP-102 (10 mg, dexamethasone sodium phosphate viscous gel) (“SEMDEXA^TM” or “SP-102”), a novel, viscous gel formulation of a widely used corticosteroid for epidural injections to treat lumbosacral radicular pain, or sciatica for which Scilex has completed a Phase 3 study; (ii) SP-103 (lidocaine topical system) 5.4%, (“SP-103”), a next-generation, triple-strength formulation of ZTlido, for the treatment of chronic neck pain and for which Scilex has recently completed a Phase 2 trial in low back pain; and (iii) SP-104 (4.5 mg, low-dose naltrexone hydrochloride delayed-release capsules) (“SP-104”), a novel low-dose delayed-release naltrexone hydrochloride being developed for the treatment of fibromyalgia, for which Phase 1 trials were completed in the second quarter of 2022 and a Phase 2 clinical trial is expected to commence in 2024.

Scilex Holding Company is headquartered in Palo Alto, California.

Forward-Looking Statements

This press release and any statements made for and during any presentation or meeting concerning the matters discussed in this press release contain forward-looking statements related to Scilex and its subsidiaries under the safe harbor provisions of Section 21E of the Private Securities Litigation Reform Act of 1995 and are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Forward-looking statements include statements regarding the potential for the Court to refuse to grant the Motion, Scilex’s plans to launch GLOPERBA in 2024 and plans to initiate a Phase 2 clinical trial in 2024 for SP-104.  

Risks and uncertainties that could cause Scilex’s actual results to differ materially and adversely from those expressed in our forward-looking statements, include, but are not limited to: risks associated with the unpredictability of trading markets and whether a market will be established for Scilex’s common stock; general economic, political and business conditions; risks related to COVID-19 (and other similar disruptions); the risk that the potential product candidates that Scilex develops may not progress through clinical development or receive required regulatory approvals within expected timelines or at all; risks relating to uncertainty regarding the regulatory pathway for Scilex’s product candidates; the risk that Scilex will be unable to successfully market or gain market acceptance of its product candidates; the risk that Scilex’s product candidates may not be beneficial to patients or successfully commercialized; the risk that Scilex has overestimated the size of the target patient population, their willingness to try new therapies and the willingness of physicians to prescribe these therapies; risks that the outcome of the trials and studies for SP-102, SP-103 or SP-104 may not be successful or reflect positive outcomes; risks that the prior results of the clinical and investigator-initiated trials of SP-102 (SEMDEXA™), SP-103 or SP-104 may not be replicated; regulatory and intellectual property risks; and other risks and uncertainties indicated from time to time and other risks described in Scilex’s most recent periodic reports filed with the Securities and Exchange Commission, including Scilex’s Annual Report on Form 10-K for the year ended December 31, 2022 and subsequent Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission, including the risk factors set forth in those filings. Investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release, and Scilex undertakes no obligation to update any forward-looking statement in this press release except as may be required by law.

Contacts:

Investors and Media
Scilex Holding Company
960 San Antonio Road
Palo Alto, CA 94303
Office: (650) 516-4310

Email: investorrelations@scilexholding.com 

Website: www.scilexholding.com

SEMDEXA™ (SP-102) is a trademark owned by Semnur Pharmaceuticals, Inc., a wholly-owned subsidiary of Scilex Holding Company. A proprietary name review by the FDA is planned.

ZTlido® is a registered trademark owned by Scilex Pharmaceuticals Inc., a wholly-owned subsidiary of Scilex Holding Company.

Gloperba® is the subject of an exclusive, transferable license to use the registered trademark by Scilex Holding Company.

ELYXYB® is the subject of an exclusive, transferable license to use the registered trademark by Scilex Holding Company.

All other trademarks are the property of their respective owners.

© 2024 Scilex Holding Company All Rights Reserved.

FAQ

What is the ticker symbol for Scilex Holding Company?

The ticker symbol for Scilex Holding Company is SCLX.

What is the motion filed by the Official Committee of Unsecured Creditors of Sorrento Therapeutics, Inc.?

The Official Committee of Unsecured Creditors of Sorrento Therapeutics, Inc. filed a motion seeking to extend the restrictions on transfer of shares of common stock of Scilex until September 30, 2024.

When were the shares of common stock of Scilex distributed by Sorrento to its stockholders as a dividend?

The shares of common stock of Scilex were distributed by Sorrento to its stockholders as a dividend on January 19, 2023.

What will happen if the U.S. Bankruptcy Court approves the Motion?

If the U.S. Bankruptcy Court approves the Motion, the holders of Dividend Stock would be prohibited from selling, transferring, or disposing of the shares until September 30, 2024.

Does the extension of restrictions apply to all securities of Scilex?

No, the extension of restrictions only applies to the Dividend Stock and does not affect any other outstanding securities of Scilex.