BioXcel Therapeutics announces 1-for-16 reverse stock split

NEW HAVEN, Conn. - BioXcel Therapeutics, Inc. (NASDAQ:BTAI), a biopharmaceutical company focused on developing medicines in neuroscience through artificial intelligence, has declared a 1-for-16 reverse stock split. The announcement comes as the company’s stock has declined over 92% in the past year, with InvestingPro data showing the company currently trades below its Fair Value. Set to take effect at 5:00 p.m. Eastern Time on February 7, 2025, the company’s common stock is expected to start trading on a split-adjusted basis when the market opens on Monday, February 10, 2025.

The reverse stock split is aimed at regaining compliance with Nasdaq’s minimum bid price requirement for continued listing. As a result of this action, every 16 shares of BioXcel Therapeutics’ issued and outstanding common stock will be automatically converted into one share of common stock. The par value per share and the authorized number of shares of common stock will remain unchanged. According to InvestingPro analysis, the company faces significant financial challenges with a weak Financial Health Score of 1.35 out of 5 and a market capitalization of just $14.83 million.

This stock consolidation will impact all shareholders uniformly and will not change their relative ownership interest in the company, except for minor adjustments due to the treatment of fractional shares. Shareholders who would hold a fractional share will instead receive a cash payment.

The adjustment will also proportionally affect the number of shares underlying BioXcel Therapeutics’ outstanding stock options, as well as the exercise or conversion prices of these options. Similarly, the number of shares of common stock issuable under the company’s equity incentive plans will be adjusted accordingly.

The decision for a reverse stock split was approved by the company’s shareholders at a special meeting on January 28, 2025, allowing the Board of Directors to implement a split ratio within a range of 1-for-5 to 1-for-30. The Board subsequently approved the 1-for-16 ratio.

BioXcel Therapeutics, alongside its wholly-owned subsidiary OnkosXcel Therapeutics, continues to leverage big data and proprietary machine learning algorithms for drug re-innovation, focusing on neuroscience and immuno-oncology. InvestingPro subscribers can access 11 additional key insights about BTAI, including detailed analysis of its cash flow position and growth prospects, available in the comprehensive Pro Research Report.

This announcement is based on a press release statement from BioXcel Therapeutics, Inc.

In other recent news, BioXcel Therapeutics has been making significant strides in its clinical trials, particularly in the SERENITY At-Home Phase 3 trial and the TRANQUILITY In-Care Phase 3 trial, both focused on the treatment of agitation in patients with bipolar disorders, schizophrenia, and Alzheimer’s dementia. These developments aim to address an estimated 140 million annual acute agitation episodes associated with these conditions. The company has also enhanced its operational and financial standing by amending a credit agreement and raising $7 million in equity funding.

BioXcel Therapeutics has seen a change in its stock outlook, with H.C. Wainwright analysts lowering the price target from $5 to $3 while maintaining a Buy rating. This adjustment was due to ongoing financial challenges and a slowdown in commercial activities for IGALMI, the company’s marketed product. BofA Securities also downgraded its rating to Underperform, citing concerns over trial outcomes and financial stability.

The company recently expanded its Board of Directors, appointing Dr. Rajiv Patni, a professional with extensive experience in global product development. This expansion aims to bring additional expertise to the company’s leadership. Furthermore, BioXcel Therapeutics has made significant changes to its executive compensation structure, including reductions in cash compensation and the granting of stock options to key executives.

These are the most recent developments in BioXcel Therapeutics’ ongoing efforts to advance its neuroscience portfolio and enhance its business structure for future growth.

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