Together with its subsidiaries, Panbela Therapeutics, Inc (NASDAQ: PBLA) focuses on developing disruptive therapeutics for the treatment of patients with cancer. With the company entering the final phase before filing for FDA approval for Flynpovi, one of its promising products according to past trials, and multiple catalysts on the horizon. PBLA stock may prove to be a stock worth holding, but it’s not all without risks.
PBLA Stock News
In April, PBLA learned that it will regain worldwide rights to develop and commercialize Flynpovi as a result of the termination of the license agreement between Cancer Prevention Pharmaceuticals, Inc. (CPP) and One-Two Therapeutics Assets Limited. The Flynpovi study showed a 100% risk reduction in the need for surgery in patients with an intact lower gastrointestinal anatomy with Flynpovi versus eflornithine or sulindac alone. Flynpovi’s registration trial is expected to begin in the second half of 2023 and is funded by PBLA’s licensing partner, One Two Therapeutics. It is important to mention that there’s no approved Familial adenomatous polyposis (FAP) treatment on the market right now that provides unmet needs that PBLA can fill with its new treatment if proven successful.
PBLA is conducting a double-blind placebo-controlled trial of Flynpovi to prevent the recurrence of high-risk adenomas and second primary colorectal cancers in patients with Stage 0 to 3 colorectal cancer. The futility analysis is expected in the first half of 2023, which will be a major catalyst for PBLA stock.
Other trials are also awaiting major updates in the next year or so. The company’s ASPIRE clinical trial in first-line treatment of metastatic pancreatic cancer. The trial started in November of last year, with the interim analysis expected in early 2024. Additionally, in January, the European Medicines Agency issued the adoption of a commission-implementing decision relating to the designation of Ivospemin as an orphan medicinal product in combination with gemcitabine and nab-paclitaxel.
Medicines that meet the EMA’s orphan designation criteria may qualify for financial and regulatory incentives, including a 10-year period of marketing exclusivity in the EU after product approval and product assistance from the EMA at reduced fees during the product development phase. This is all the more reason for PBLA to invest more in its Aspire trial, which they did. PBLA research expenses increased in Q1 2023 by more than 37%, from $2.2 million to $3.5 million.
It’s not all roses for PBLA though. PBLA just underwent a 1 for 40 reverse split last January to maintain compliance with the NASDAQ minimum bid price requirement. That left PBLA with approximately 1.7 million shares outstanding at the time. Shortly after, PBLA announced a public offering of 6.6 million shares and warrants to purchase up to 13.3 million shares at a purchase price of $2.25 per share and an exercise price of $2.75 per share. The public offering was completed for gross proceeds of approximately $15 million.
PBLA stock is currently trading under the $1 continued listing requirement of The Nasdaq Capital Market, which puts it at risk for the need for another reverse split in the near future. Furthermore, PBLA cash and cash equivalents stand at $5.2 million, only enough to cover till early Q3 of 2023. As Sue Horvath, PBLA’s CFO & VP, said in the company’s latest earnings call, “We anticipate that the ongoing cash used in operations will be between $5 million and $5.5 million per quarter and therefore are projecting that the current cash on hand will take us into very early Q3 of 2023.”. That means that PBLA needs to raise additional capital, which explains why PBLA on May 8th Announced 33.3 million shares and warrant offering at a purchase price of $0.45, which will further dilute the stock.
PBLA’s future success is dependent upon its ability to obtain additional financing and the success of its development efforts. If PBLA is unable to obtain additional financing when needed or if its clinical trials are not successful, it would not be able to continue operating and would be forced to cease operations and liquidate the company.
In other news, PBLA stock was recently given a buy rating and a $7 price target by HC Wainwright & Co. analyst Joseph Pantginis. Despite that, many investors believe they must see improvements to PBLA stock trade price before they can be fully on board with the $7 price target.
PBLA Stock Financials
In its Q1 2023 report, PBLA assets increased to $16 million in assets, including $5.2 million in cash and cash equivalent, from $4.9 million in assets, including $1.2 million in last year.
PBLA’s total liabilities increased from $13 million to $13.9 million, including an increase in current liabilities from $7.8 million to $9.7 million. Operating losses increased YoY from $4 million to $4.8 million, including a decrease in administrative expenses from $1.79 million to $1.35 million and an increase in research expenses from $2.2 million to $3.5 million, which amounted to a net loss increase from $3.6 million to $5.7 million.
Media Sentiment
@greatstockpicks Says that the $7 price target is too high, based on PBLA stock’s current PPS.
@TheBULL_Runner believes that PBLA stock’s current PPS is a steal.
Technical Analysis
PBLA stock’s trend is neutral with the stock trading in a sideways channel. PBLA is trading below the 21, 50, and 200 MAs which are bearish indicators, and the MACD is approaching a bearish cross. However, there is a gap near $.48 that was formed on the company’s latest offering. Since gaps have to be filled, this gap could be filled soon considering the hype PBLA stock is receiving currently.
PBLA just witnessed two catalysts back to back, with its earnings release on May 4th and its public offering of 33.3 million shares. PBLA stock is awaiting another catalyst in the next couple of months with its futility analysis of one of its Flynpovi trials to be released in the first half of 2023. A potential play could be going long with an entry on the $0.37 support and taking profits at the $0.5 support, with SL at $0.33 after breaking the $0.37 support.
PBLA Stock Forecast
PBLA stock is an exciting prospect, with many important catalysts ahead. If PBLA can gain approval for Flynpovi, it would be the first drug therapy for the treatment of FAP. That said, there are several steps that PBLA needs to complete. PBLA needs to secure the necessary funds to support its current business successfully, produce positive results and obtain marketing approval for its product candidates. If successfully done, PBLA could be on the right path to eventually achieve profitability. But if not, PBLA would be forced to declare bankruptcy and cease operations. For these reasons, PBLA stock is certainly one to keep an eye on.
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