- The stock price of Avenue Therapeutics (ATXI) increased by over 24% after hours in the most recent trading session. This is why.
The stock price of Avenue Therapeutics (ATXI) increased by over 24% after hours in the most recent trading session.
Why: Avenue Therapeutics announced that it will effect a 1-for-15 reverse split of its common stock, which will be effective for trading purposes on the Nasdaq Capital Market as of the commencement of trading on September 23, 2022, and also provided a regulatory update related to its intravenous (IV) Tramadol product candidate.
Reverse Stock Split: The reverse stock split was approved on July 25, 2022 by stockholders representing approximately 73% of the voting power of the outstanding voting stock of the company with authorization to determine the final ratio having been granted to the Company’s Board of Directors.
After the effectiveness of the reverse stock split, the company expects that the number of outstanding shares of common stock will be reduced from approximately 22.7 million to approximately 1.5 million, subject to adjustment to give effect to the treatment of any fractional shares that stockholders would have received in the reverse stock split. No fractional shares will be issued in connection with the reverse stock split and stockholders who would otherwise be entitled to a fractional share will receive a proportional cash payment.
IV Tramadol regulatory update: Avenue received the official meeting minutes from the FDA regarding a meeting conducted on August 9, 2022, for IV Tramadol. Avenue submitted the Type A Meeting Request and related briefing documents to the FDA on June 17, 2022, and included a proposed study design to address the concerns around the safety risk of IV Tramadol in combination with other opioid analgesics for the management of moderate-to-moderately-severe pain in adults in a medically supervised healthcare setting that was discussed in detail at the previously disclosed Advisory Committee meeting on February 15, 2022 and in the Appeal Denied letter received on March 18, 2022.
At the meeting, Avenue had presented a study design for a single safety clinical trial that the company believes could address the concerns regarding risks related to opioid stacking. And the FDA stated that the proposed study design appears reasonable and agreed on various study design aspects with the expectation that additional feedback would be provided to Avenue upon review of a more detailed study protocol. The Company intends to incorporate the FDA’s suggestions from the meeting minutes and submit a detailed study protocol that could form the basis for the submission of a complete response to the second Complete Response Letter for IV Tramadol.