RedHill Biopharma faces Nasdaq non-compliance issue

TEL AVIV, Israel and RALEIGH, N.C. - RedHill Biopharma Ltd. (NASDAQ:RDHL), a specialty biopharmaceutical company with a market capitalization of $3.63 million, disclosed on Thursday that it has received a Notification Letter from Nasdaq’s Listing Qualifications Department. The notice, dated April 15, 2025, indicates the company’s non-compliance with Nasdaq’s minimum stockholders’ equity requirement.

Nasdaq Listing Rule 5550(b)(1) mandates that companies on the Nasdaq Capital Market maintain a minimum stockholders’ equity of $2,500,000. RedHill’s Annual Report for the fiscal year ending December 31, 2024, shows a stockholders’ deficit of $4,683,000, falling short of this requirement and the alternative compliance options based on market value or net income. InvestingPro data reveals concerning metrics, including a weak current ratio of 0.54 and short-term obligations exceeding liquid assets.

The notification does not immediately affect RedHill’s listing or business operations. The company has until May 30, 2025, to submit a compliance plan to Nasdaq. If Nasdaq accepts the plan, it may grant RedHill up to 180 days to demonstrate compliance.

RedHill is exploring options to address the deficiency and plans to submit a compliance plan promptly. However, there is no guarantee that the plan will be accepted or that the company will regain compliance.

RedHill Biopharma focuses on the development and commercialization of drugs for gastrointestinal diseases, infectious diseases, and oncology. It markets the FDA-approved gastrointestinal drug Talicia for Helicobacter pylori infection and has several late-stage development programs, including treatments for COVID-19 and various cancers. Despite current challenges, the company achieved 23.17% revenue growth in the last twelve months, and according to InvestingPro analysis, analysts expect profitability in the coming year (discover 14 additional exclusive ProTips with a subscription).

This news is based on a press release statement from RedHill Biopharma. The company’s future ability to maintain its Nasdaq listing and the success of its development programs remain subject to significant risks and uncertainties.

In other recent news, RedHill Biopharma Ltd reported a decrease in net revenues to $18.2 million for Q1 2022, down from $22.1 million in the previous quarter, while maintaining a gross profit of $10.2 million with a 56% margin. The company also announced plans to submit a Marketing Authorization Application in the UK for its H. pylori treatment, Talicia, using a fast-track approval process, potentially leading to UK approval by the fourth quarter of 2025. Additionally, RedHill entered a licensing agreement with Hyloris Pharmaceuticals for the global development and commercialization of RHB-102, excluding North America, which could be worth up to $60 million. The collaboration follows positive feedback from the UK’s regulatory agency, paving the way for potential approval of RHB-102 in the UK. Despite the revenue dip, RedHill has significantly reduced R&D expenses and is focused on achieving positive cash flow in the second half of 2022. The company is also exploring potential acquisitions and external funding for R&D programs to support its strategic growth.

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