The move, which will leave the reduce the number of shares outstanding on the company from approximately 112.4 million to approximately 18.7 million, will be effective at Friday’s market open.
The company is making the change to comply with Nasdaq marketplace rule 5450(a)(1), which says stocks listed on the exchange cannot trade below a dollar for more than thirty consecutive business days.
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In April, shares of AEZ tumbled after the company announced that its lead offering, Perifosine, failed to meet its primary endpoint. A trial involving 468 patients conducted by its North American licensee partner, Keryx Biopharmaceuticals, did not improve overall colorectal cancer survival rates versus a placebo.
The news was a bitter pill to shareholders hoping Perifosine could take away the sting of notable disappointments, including cetrorelix, a prostate treatment that failed to meet its primary endpoint and led to the termination of its partnership with Paris based pharmaceutical giant Sanofi-Aventis.
AEterna Zentaris had trimmed its losses to just over $27-million in fiscal 2011, but its only source of revenue at present is non periodic milestone payments for Cetrotide, an in vitro fertilization drug that is currently the company’s only marketed product.
Shares of AEterna Zentaris on the TSX closed today down 14.7% to $.58 cents.