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Investing.com--U.S. and Australia-listed biopharmaceutical firm Opthea Ltd (NASDAQ:OPT) on Monday raised concerns over its ability to continue operations after a major phase 3 trial did not meet its primary endpoint.
The biopharmaceutical firm said in a press release that its COAST Phase 3 trial to treat wet age-related macular degeneration, a serious eye condition, failed to meet its primary endpoint.
The COAST trial is one of the biopharma firm’s two simultaneous phase 3 trials to develop treatments in the macular degeneration market.
Both trials are tied to Opthea’s Development Funding Agreement, under which it received hundreds of millions of dollars in investment. Opthea said it in light of its phase 3 trial, it may be obligated to repay its DFA investors, and could be obligated to pay up to “four multiples” of the amounts invested into the company. Amounts could reach as high as $680 million,
The company said its board and management were in active discussions with DFA investors, and that the company was unable to secure any additional non-equity funding or dispose of its assets without consent from its DFA investors.
The company flagged a “material uncertainty” over its ability to continue as a going concern. It said it had an unaudited cash and cash equivalent balance of $113.8 million as of February 28.
Opthea’s shares were on trading halt since March 14 and until at least March 31, or when the company can provide an update on its operations. The company has a market capital of about $738.8 million.