In the after-hours trading on April 27, Statera Biopharma Inc. (STAB) stock saw a huge uptick as its shares swung up by over 100%. After falling to a new low in the regular session, STAB surged up to $0.4199 in the after hours. The stock saw unusually high volume on Wednesday which was over 529% of its average.
This uptick came after the company announced its plan to sell rights for low-dose naltrexone to Immune Therapeutics. Added to the news was the earlier downfall causing a big dip in the stock which presented STAB as a perfect fit for the rally. A dip together with the news caused investors to go wild on the stock and made its surge by 100.91%.
STAB’s Plan for Naltrexone
On Wednesday, the company announced it had entered into a non-binding term sheet in connection with a strategic partnership with Immune Therapeuctics, Inc. for the sale of naltrexone and met-enkephalin rights. Immune Therapeutics develops and commercializes drugs.
Being a non-binding term sheet, the deal is contingent upon various factors including negotiation of a definitive agreement, financing of Immune Therapeutics, and customary closing conditions. Moreover, the terms of the agreement will have STAB receiver an initial upfront payment of $2 million and 5% of the issued, outstanding stock if Immune. Added to this, the company will also be eligible for payments on revenue-based milestones, new indications, regulatory approvals, royalties, etc. In exchange, Immune will have rights to any product with low-dose naltrexone as an active ingredient.
Overall, the transaction has the potential of generating over $400 million in non-dilutive payments to the company.
Enhancing STAB’s Potential Amid Nasdaq Non-compliance
Failing to file its 2021 financial statement in the given period after it missed the initial deadline, STAB is in non-compliance with Nasdaq Listing Rules. The company currently has till June 20 to submit a plan for regaining compliance by October 17 of this year.
While the company still has to submit its financials for 2021, its agreement with Immune will strengthen its financial position. The transaction has the ability to result in significant cash flow for funding the company’s programs including its new plans for the immunotherapy field.
Owing to its potentially huge deal with Immune Therapeutics on Wednesday, STAB witnessed a huge upsurge in the after hours. Investors were super excited over the company’s transaction that could yield up to $400 million in non-dilutive payments.
However, the mammoth gain has put the stock up for corrections soon.