Hepion Pharmaceuticals inks deal to license diagnostic tests

MORRISTOWN, N.J. - Hepion Pharmaceuticals, Inc. (NASDAQ:HEPA), a micro-cap biopharmaceutical company with a market capitalization of just $3.55 million, announced today a licensing agreement with New Day Diagnostics LLC to in-license a suite of diagnostic tests. According to InvestingPro data, the company faces significant financial challenges with a weak financial health score and rapidly diminishing cash reserves. This strategic move aims to expand Hepion’s product portfolio into diagnostics for various diseases, including celiac disease, respiratory illnesses, and hepatocellular carcinoma (HCC).

The licensed tests, which have received CE marks, making them eligible for sale in Europe, address a combined market projected to exceed $15 billion. This market opportunity comes at a crucial time for Hepion, as InvestingPro analysis shows the company’s current ratio of 0.51 indicates potential liquidity concerns, with short-term obligations exceeding liquid assets. Among the tests is the Respiratory Panel RT-PCR Multiplex CE-IVD, designed for the simultaneous detection of COVID-19, Influenza A/B, and RSV, targeting a market worth $5.6 billion with an annual growth rate of 6.6% through 2029.

Also included in the licensing are the H. pylori CE-IVD, aimed at the early detection of infections that can cause gastric ulcers and cancer in a $700 million market, and the CeliaCare CE-IVD for celiac disease screening, addressing a market growing at 10.4% annually. Furthermore, the mSEPT9 assay for early detection of HCC in high-risk patients serves an $8.7 billion market with a 6.7% growth forecast through 2030.

John Brancaccio, Executive Chairman and Interim CEO of Hepion, expressed optimism about the potential for near-term revenue generation in the European Union through this agreement. Eric Mayer, CEO of New Day Diagnostics, shared the sentiment, highlighting the partnership’s goal to improve early detection and outcomes for multiple diseases.

This announcement comes after Hepion’s decision in April 2024 to wind down its ASCEND-NASH clinical trial, which had been evaluating the safety and efficacy of its primary asset, Rencofilstat, for non-alcoholic steatohepatitis (NASH). The trial faced enrollment challenges, with the company pausing the process after randomizing 151 subjects out of a target of 336. Trading at $0.32 per share, the stock has experienced significant volatility, with InvestingPro offering 15+ additional insights about the company’s financial health and market performance (available to subscribers).

The licensing agreement represents a pivot in Hepion’s strategy, as the company seeks to leverage new opportunities beyond its original focus on liver diseases. The information disclosed is based on a press release statement from Hepion Pharmaceuticals.

In other recent news, Hepion Pharmaceuticals has enacted a one-for-fifty reverse stock split of its common stock. This move, effective after market close, aims to meet NASDAQ’s minimum bid price requirement for continued listing. The reverse stock split reduces the number of outstanding shares from approximately 54.25 million to roughly 1.08 million, without altering stockholders’ percentage ownership or voting power. Additionally, Hepion disclosed its unaudited consolidated balance sheet as of January 31, 2025, providing investors with a snapshot of its financial position. The balance sheet release is part of the company’s routine regulatory requirements. Meanwhile, Hepion received a notice from the Nasdaq Stock Market indicating that its stock has not met the minimum bid price requirement, risking potential delisting. The company plans to appeal this decision, although success is not guaranteed. These developments highlight the company’s efforts to maintain its NASDAQ listing amidst financial and regulatory challenges.

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