Traws Pharma Regains Compliance with NASDAQ Equity Listing Rule

Rhea-AI Summary

Traws Pharma (NASDAQ: TRAW) has successfully regained compliance with Nasdaq's minimum stockholders' equity requirement (Rule 5550(b)(1)), ensuring continued listing on The NASDAQ Capital Market. The compliance was achieved following a $20 million gross proceeds offering completed on December 30, 2024.

The company will remain under mandatory panel monitoring through February 25, 2026. During this period, if Traws falls below the $2.5 million stockholders' equity requirement, it would face delisting without a cure period, though with the option to request a new hearing.

Traws, a clinical-stage biopharmaceutical company, is developing oral small molecules for respiratory viral diseases. Their lead program for bird flu/influenza has recently completed a Phase 1 trial, with ongoing laboratory studies.

Positive

• Regained Nasdaq listing compliance
• $20M financing secured from healthcare investors
• Phase 1 trial completed for lead program

Negative

• Risk of immediate delisting if equity falls below $2.5M through Feb 2026
• Mandatory monitoring period imposed by Nasdaq

Insights

Financial Analyst

Traws Pharma's announcement of regaining NASDAQ compliance represents a critical regulatory milestone that removes a significant near-term risk for shareholders. The company had been at risk of delisting, which would have severely impacted stock liquidity and institutional investor access.

The successful $20 million financing from institutional healthcare investors in December 2024 was instrumental in meeting the $2.5 million minimum stockholders' equity requirement. This capital infusion not only satisfies NASDAQ requirements but also provides essential runway for their clinical programs, particularly their bird flu/influenza candidate that recently completed Phase 1 trials.

Investors should note the mandatory monitoring period through February 2026, creating a clear compliance timeline the company must maintain. Any future equity erosion could trigger immediate delisting proceedings without a standard cure period, representing an ongoing risk factor.

The announcement ties together three significant elements: regulatory compliance preservation, substantial capital raising, and clinical pipeline advancement. For a small-cap biopharma with $12.8 million market capitalization, maintaining NASDAQ listing is particularly important for capital market access as they progress through capital-intensive clinical development stages.

Biotech Specialist

Traws' compliance achievement should be viewed alongside their clinical progress, particularly with their lead program targeting bird flu/influenza. The recent Phase 1 completion represents a fundamental derisking step, though investors should recognize that early-stage trial completion primarily establishes safety parameters rather than efficacy.

The company's strategic focus on respiratory viral diseases positions them in a clinically relevant therapeutic area that gained significant attention following the pandemic. Their development of oral small molecules offers potential advantages in administration and distribution compared to injectable alternatives.

The $20 million financing provides critical runway for their pipeline development, though typical burn rates for small molecule clinical programs suggest careful cash management will remain essential. Clinical-stage biopharmas typically require substantial additional capital through Phase 2 and pivotal studies.

Investors should pay close attention to upcoming data readouts from the completed Phase 1 trial and ongoing laboratory studies for bird flu. These results will provide critical insights into the compound's potential and could serve as significant catalysts. The CEO's characterization of 2025 as potentially "transformational" likely hinges on these forthcoming clinical and preclinical results.

NEWTOWN, Pa., Feb. 28, 2025 (GLOBE NEWSWIRE) -- Traws Pharma, Inc. (Nasdaq: TRAW) (“Traws” or “Traws Pharma”), a clinical stage biopharmaceutical company developing oral small molecules for the treatment of respiratory viral diseases, announced today that it has received confirmation from Nasdaq that Traws has regained compliance with the minimum stockholders’ equity requirements of Nasdaq Listing Rule 5550(b)(1), which requires listed companies to maintain a minimum of $2.5 million in stockholders’ equity. Accordingly, Traws common stock will continue to be listed and trade on The NASDAQ Capital Market under the symbol “TRAW”.

“2025 has the potential to be a transformational year for Traws as we advance our pipeline of novel, investigational antivirals, led by our program for bird flu/influenza, that recently completed a Phase 1 trial, with ongoing laboratory studies programs for bird flu. We are very thankful to the Nasdaq Hearings Panel for recognizing the significant progress that Traws has made over the last few months. We believe that achievement of important corporate milestones, including regaining compliance with the stockholders’ equity requirement for continued listing and strengthening the Company’s financial position through a recent financing from leading institutional healthcare investors, have put us in the position to deliver on our goal of developing novel antivirals, with initial focus on bird flu and influenza,” said Werner Cautreels, PhD, Chief Executive Officer of Traws Pharma.

On February 25, 2025, the Nasdaq Hearings Panel issued a decision letter confirming that the Company has regained compliance with the minimum stockholders’ equity requirement of Listing Rule 550(b)(1), following the hearing held on November 14, 2024. Since then, Traws has taken several important steps, including the successful closing of an offering that resulted in $20 million in gross proceeds to the Company on December 30, 2024. As part of the compliance confirmation, Traws will be subject to a mandatory panel monitoring through February 25, 2026. Should Traws fall out of compliance with the minimum stockholders’ equity requirement during that time, the company would become subject to delisting without a cure period. The Company will have the opportunity to request a new hearing should that event occur.

About Traws Pharma, Inc.
Traws Pharma is a clinical-stage biopharmaceutical company developing potential oral small molecule therapies for the treatment of respiratory viral diseases. The viral respiratory disease program includes two novel, Phase 1, potentially best-in-class drug candidates: tivoxavir marboxil, in development for bird/pandemic flu and seasonal flu, targeting the influenza cap-dependent endonuclease (CEN); and ratutrelvir, in development as a COVID treatment, targeting the Mpro (3CL protease), without the need for co-administration of ritonavir.

Traws is committed to delivering novel compounds for unmet medical needs using state-of-the-art drug development technology. With a focus on product safety and a commitment to patients in need or that are specifically vulnerable, we aim to build solutions for important medical challenges and alleviate the burden of viral infections.

Forward-Looking Statements
Some of the statements in this release are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, and involve risks and uncertainties including statements regarding the Company, its business and product candidates. The Company has attempted to identify forward-looking statements by terminology including “believes”, “estimates”, “anticipates”, “expects”, “plans”, “intends”, “may”, “could”, “might”, “will”, “should”, “supports”, “preliminary”, “encouraging”, “approximately” or other words that convey uncertainty of future events or outcomes. Although Traws believes that the expectations reflected in such forward-looking statements are reasonable as of the date made, expectations may prove to have been materially different from the results expressed or implied by such forward looking statements. These statements are only predictions and involve known and unknown risks, uncertainties, and other factors, including the success and timing of Traws’ clinical trials for product candidates for bird/pandemic flu and COVID-19 and other potential product candidates, collaborations, market conditions, the Company’s ability to maintain compliance with the Nasdaq minimum stockholders’ equity requirement and other applicable listing rules, the Company’s ability to raise additional capital if and when needed, and those discussed under the heading “Risk Factors” in Traws’ filings with the U.S. Securities and Exchange Commission. Any forward-looking statements contained in this release speak only as of its date. Traws undertakes no obligation to update any forward-looking statements contained in this release to reflect events or circumstances occurring after its date or to reflect the occurrence of unanticipated events.

Traws Pharma Contact:
Nora Brennan
Traws Pharma, Inc.
nbrennan@trawspharma.com
www.trawspharma.com

Investor Contact:
Bruce Mackle
LifeSci Advisors, LLC
646-889-1200
bmackle@lifesciadvisors.com

FAQ

What was the amount of Traws Pharma's (TRAW) recent financing round in December 2024?

Traws Pharma raised $20 million in gross proceeds through an offering completed on December 30, 2024.

How long will TRAW be under Nasdaq mandatory panel monitoring?

Traws will be under mandatory panel monitoring through February 25, 2026.

What is the minimum stockholders' equity requirement for Traws (TRAW) to maintain Nasdaq listing?

Traws must maintain a minimum of $2.5 million in stockholders' equity under Nasdaq Listing Rule 5550(b)(1).

What stage is Traws Pharma's (TRAW) bird flu/influenza program in development?

Traws has recently completed a Phase 1 trial for their bird flu/influenza program, with ongoing laboratory studies.