Aptevo Therapeutics gets Nasdaq stockholders' equity notice, sets 1-for-20 reverse stock split

Aptevo Therapeutics Inc. (Nasdaq: APVO) disclosed three items in a Form 8-K filed May 22, 2025: a Nasdaq notice that it does not meet the stockholders' equity requirement, a new prospectus supplement for an at-the-market stock offering, and a 1-for-20 reverse stock split. The offering adds shares to the market while the company is out of compliance, and the split changes the share count without changing the deficit that triggered the notice.

The stockholders' equity notice

On May 22, 2025, Aptevo received a letter from The Nasdaq Stock Market LLC saying it is not in compliance with Nasdaq Listing Rule 5550(b)(1). That rule requires companies on the Nasdaq Capital Market to maintain at least $2,500,000 in stockholders' equity. The company's quarterly report for the period ended March 31, 2025 showed a stockholders' deficit of $1,473,000.

The letter gave Aptevo 45 calendar days, or until July 7, 2025, to submit a plan to regain compliance. If the plan is accepted, the company can be granted up to 180 calendar days from May 22, 2025, or until November 18, 2025, to show compliance. The company says it intends to submit its plan by the deadline, but there is no assurance Nasdaq will accept it. If the plan is rejected, or accepted and then missed, Aptevo can request a hearing before an independent panel. The 8-K says there is no assurance such an appeal would succeed.

The at-the-market offering

An at-the-market offering lets a company sell new shares into the market over time through a sales agent. Aptevo's agreement dated April 28, 2025 names Roth Capital Partners, LLC as sales agent. On May 22, 2025, the company filed a prospectus supplement under its effective Form S-3 covering shares with an aggregate offering price of up to $3,015,515.

The 8-K says that, as of the supplement date, the company had issued and sold 7,989,040 shares under the agreement and earlier prospectuses, for aggregate gross sale proceeds of $3,349,104. The press release puts shares outstanding at approximately 13.5 million before the split. Paul Hastings LLP, counsel to the company, issued a legal opinion on the shares, filed as Exhibit 5.1. The 8-K does not name any bank other than the sales agent.

The 1-for-20 reverse split

In a press release dated May 22, 2025, Aptevo said it will conduct a 1-for-20 reverse stock split effective at 5:01 p.m. Eastern Time on May 23, 2025. Shares are expected to begin trading on a split-adjusted basis on the Nasdaq Capital Market at market open on May 27, 2025, under the unchanged symbol APVO. The company says the split will reduce outstanding shares from approximately 13.5 million to approximately 0.7 million, subject to rounding and any further issuances.

Stockholders approved the split at a Special Meeting on May 14, 2025, and the board approved the final ratio on May 21, 2025. The release calls the split part of the company's plan to maintain compliance with Nasdaq's continued listing standards, among other benefits. A reverse split reduces the number of shares. It does not by itself change the stockholders' deficit cited in the notice.

The business

Aptevo describes itself as a clinical-stage biotechnology company developing bispecific immunotherapies for cancer, built on its ADAPTIR platform. Its lead candidate, mipletamig, is a CD3xCD123 T cell engager in the RAINIER trial, part one of a Phase 1b/2 program started in August 2024 in frontline acute myelogenous leukemia, given with standard of care venetoclax and azacitidine. The annual report calls the Phase 1 dose escalation and expansion results positive, and says the company is now running a dose optimization Phase 1b/2 trial.

Its other clinical candidate, ALG.APV-527, targets 4-1BB and 5T4. The company's 8-K was signed by Marvin L. White, President and Chief Executive Officer.

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