Adial Pharmaceuticals gets Nasdaq minimum bid price deficiency notice, has until September 1, 2025

Adial Pharmaceuticals, Inc. (Nasdaq: ADIL) received written notice from the Nasdaq Listing Qualifications Department on March 5, 2025. The notice said its common stock had not maintained a minimum closing bid price of $1.00 per share for the 30 consecutive business days from January 17, 2025 through March 4, 2025. The company disclosed the notice in a Form 8-K filed March 7, 2025, under Item 3.01. The notice cites Nasdaq Listing Rule 5550(a)(2), which sets the minimum bid price.

The 8-K says the notice "has no immediate effect on the listing or trading" of the common stock, which will keep trading on The Nasdaq Capital Market under the symbol ADIL. That protection is temporary.

The compliance clock

Under Nasdaq Listing Rule 5810(c)(3)(A), Adial has 180 calendar days, or until September 1, 2025, to regain compliance. Compliance can come without further action if the closing bid price is at or above $1.00 for at least ten consecutive business days during that period.

If Adial does not cure by September 1, it may qualify for more time. To be eligible, it must meet the continued listing requirement for market value of publicly held shares and all other initial listing standards for The Nasdaq Capital Market, except the bid price requirement. It must also notify Nasdaq in writing that it intends to cure the deficiency during a second compliance period. The 8-K does not report the company's share price after the notice.

What the company plans

The company says it "intends to actively monitor the bid price" of its common stock. It will also consider available options, including "effecting a reverse stock split to maintain its Nasdaq listing." A reverse stock split combines existing shares into fewer shares, which raises the price per share.

Adial's annual report for 2024 lists 6,574,588 shares of common stock outstanding as of February 28, 2025. The cover page puts the market value of shares held by non-affiliates at $4,832,073, based on the closing price on June 30, 2024.

What the annual report warns

The risk factors in the annual report say there is "substantial doubt about our ability to continue as a going concern." They also say Adial has no product revenues and "may not generate revenue at any time in the near future, if at all."

The business depends on one product candidate, AD04. The report says its active ingredient, ondansetron, is already available in generic form. It also says that, for ondansetron under short-term use, there are currently no long-term clinical safety data. The risk factors state that the FDA or EMA may not accept the planned Phase 3 endpoints for final approval of AD04. If either regulator requires additional clinical trials, the company says it will incur additional costs.

The risk factors also list weaknesses in internal controls, a need for more financing that may not be available "on favorable terms, if at all," and limited experience conducting clinical trials. The company says its cash and cash equivalents are not expected to be sufficient to fund operations for the twelve months from the date of the annual report. It reported net losses of approximately $13.2 million for 2024 and $5.1 million for 2023, accumulated deficits of approximately $82.0 million and $68.8 million as of December 31, 2024 and 2023, and cash used in operations of approximately $6.9 million in 2024.

The company

Adial is a Delaware corporation with executive offices in Glen Allen, Virginia. Cary J. Claiborne, President and Chief Executive Officer, signed the 8-K, which the company dated March 7, 2025. The annual report also describes a January 2023 option agreement under which Adial granted Adovate LLC an option to acquire all of the assets of Purnovate, Inc. Adovate exercised it effective May 16, 2023 and paid $450,000 in fees. The report says Adial's then-CEO was a significant equity holder in Purnovate, LLC, so the deal was a related party transaction.

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