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TEL AVIV – PainReform Ltd. (NASDAQ:PRFX), a specialty pharmaceutical company trading at $1.92 per share with a market capitalization of $1.72 million, has announced a strategic pivot towards the clean energy sector with the acquisition of DeepSolar, an AI-driven solar analytics platform. According to InvestingPro data, the company's stock has declined nearly 38% year-to-date, reflecting investor concerns about its operational trajectory. This move is part of the company's broader strategy to invest in high-margin, technology-driven sectors, as stated by Ehud Geller, Chairman and interim CEO.
The acquisition is expected to generate significant revenue and enhance long-term shareholder value through DeepSolar's scalable SaaS platform. PainReform plans to explore strategic partnerships with utility companies, solar technology providers, and smart grid operators.
Despite a setback in their Phase 3 clinical trial for PRF-110, a drug candidate aimed at post-operative pain relief, PainReform is addressing data gaps and refining the drug's pharmacokinetics and pharmacodynamics. The trial encountered issues with the final 24-hour data for bunionectomy patients, but the company is using advanced models to prepare for further clinical work.
Financially, PainReform reported an increase in research and development expenses to approximately $11.7 million for the year ended December 31, 2024, up from $6.0 million the previous year, primarily due to clinical trial and manufacturing costs. General and administrative expenses decreased to $3.0 million from $3.6 million, attributed to lower insurance costs and share-based compensation expenses.
The company experienced a net loss of approximately $14.6 million for the year, an increase from a net loss of $9.3 million in the prior year. InvestingPro analysis reveals concerning financial health indicators, with EBITDA at -$17.81 million and a current ratio of 0.61, suggesting potential liquidity challenges. Despite these headwinds, a recent $0.9 million capital raise and the DeepSolar acquisition have bolstered shareholder equity, believed to now exceed Nasdaq's minimum requirement of $2.5 million.
As of December 31, 2024, PainReform had a positive working capital of approximately $2.0 million. The annual report for 2024 has been filed with the U.S. Securities and Exchange Commission and is available on the company's investor relations website.
This business update, based on a press release statement, highlights PainReform's commitment to adhering to Nasdaq's listing standards and its focus on strategic growth in both the pharmaceutical and clean energy sectors. InvestingPro subscribers have access to 12 additional key insights about PRFX, including detailed analysis of its cash burn rate and profitability metrics, essential for understanding the company's transformation journey.
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