November 15, 2017

Biostage misses 3Q filing deadline due to financial woes

File Photo
Biostage CEO Jim McGorry (left) and Chief Medical Officer Saverio La Francesca. The company was quickly running out of money, necessitating layoffs and a late 3Q filing.

Hollistion biotech manufacturer Biostage has notified the U.S. Securities and Exchange Commission its third-quarter report will be late.

The notification comes just a month after the company laid off 17 of its 24 employees after it was delisted from NASDAQ. That represented a 71-percent reduction of its workforce.

That reduction was made to conserve the company's remaining cash on hand, which is exceeded by its financial obligations, Biostage said in a filing Tuesday.

Biostage said it is exploring financing and other strategic alternatives.

"The company has diligently pursued appropriate reporting and disclosures with respect to its Form 10-Q filing, but in light of these recent events, it will be unable to complete the necessary analysis and disclosures to timely file its Form 10-Q for the quarter ended September 30, 2017," the company said in the filing.

The company attributed its NASDAQ delisting and financial woes to an agreed-upon $3-million investment with Dallas investment firm First Pecos LLC that fell through, with both companies alleging a breach of obligations against one another.

The company's stock closed Tuesday trading a tick under $0.08 a share on the OTCQB exchange. That's higher than its Oct. 18 low of $0.067. In August, however, stock in the company was trading for $0.60 a share.

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