Allarity Therapeutics Inc

Allarity Therapeutics, Inc. (NASDAQ: ALLR) is a clinical-stage pharmaceutical company focused on developing personalized cancer treatments. The Company is focused on development of stenoparib, a poly-ADP-ribose polymerase/Tankyrase inhibitor for advanced ovarian cancer patients, using its DRP companion diagnostic for patient selection in the ongoing phase 2 clinical trial, NCT03878849. It has in-licensed the intellectual property rights to develop, use and market stenoparib.

Key Recent Business & Financial Updates:

• Financial Strengthening and Operational Streamlining: In 2024, under new management, Allarity Therapeutics has significantly bolstered its financial position, reporting a robust cash balance of USD 20 million as of July 19, 2024, which is expected to support operations until 2026. Consequently, the Company has decided to pause it’s At-The-Market (ATM) offering program. Additionally, Allarity has streamlined its operations, focusing on cost reductions and enhancing efficiency. A major achievement includes the consolidation of the capital structure into a single class of common stock, eliminating complex, variable-priced securities.
• Focus on Stenoparib and Clinical Progress: Allarity has strategically shifted its focus solely to the development of stenoparib, a novel dual PARP and Tankyrase inhibitor, showing promising results in its Phase 2 clinical trial for advanced ovarian cancer. The trial has demonstrated an extended duration of clinical benefit, with multiple patients remaining on treatment for over 30 weeks. These results have provided the necessary clinical proof of concept, leading Allarity to prepare for a follow-on clinical trial aimed at accelerating regulatory approval by the FDA.
• SEC Wells Notice and Nasdaq Compliance: Allarity disclosed receiving a Wells Notice from the SEC related to disclosures concerning FDA meetings regarding the Company's NDA for Dovitinib, with the alleged conduct occurring prior to fiscal year 2022. While this notice is not a formal charge, Allarity is cooperating with the SEC and intends to respond formally. Concurrently, the Company has proposed a reverse stock split to its shareholders, critical for maintaining Nasdaq listing compliance. The reverse split is deemed essential for sustaining investor confidence and ensuring stock liquidity, with potential delisting posing significant risks to the Company's strategic initiatives.
• Allarity Urges Stockholders to Support Reverse Stock Split and Reduction in Authorized Shares: On July 24, 2024, Allarity Therapeutics, Inc. encouraged its stockholders to actively participate in the upcoming annual meeting on July 26, 2024, and to vote in favor of the proposed reverse stock split and reduction in authorized shares. The Board of Directors emphasized the critical importance of these measures to maintain compliance with Nasdaq listing requirements, which, if not approved, could lead to the delisting of Allarity’s common stock. The Board strongly recommends that stockholders reconsider any previous opposition and vote in favor of these proposals to preserve the company's stock market position and support its ongoing strategic initiatives.
• Allarity Therapeutics Postpones Annual Stockholders Meeting: On July 26, 2024, Allarity Therapeutics, Inc. announced that its Board of Directors has postponed the Annual Meeting of Stockholders, originally scheduled for the same day at 10:00 AM Eastern Time. The decision, made on July 25, 2024, under the authority granted by the Company’s bylaws, delays the meeting to a future date yet to be determined. Allarity will provide updated information regarding the rescheduled meeting date and any necessary new record date as soon as it becomes available.
• Allarity Granted Hearing Before Nasdaq Panel: On June 27, 2024, Allarity Therapeutics, Inc. announced that it has been granted a hearing before a Nasdaq Hearings Panel to present its plan for regaining compliance with Nasdaq Listing Rule 5550(a)(2), which mandates a minimum bid price of USD 1.00 per share. This hearing, scheduled to occur in approximately five weeks, follows the company's receipt of a non-compliance notice, as disclosed in its Form 8-K filed on June 21, 2024. Allarity has been actively preparing for the hearing and intends to provide updates on the process as substantive developments occur.
• Capital Structure Improvements: During the first quarter of 2024, Allarity Therapeutics made significant strides in streamlining its capital structure. The company successfully converted all outstanding Series A Preferred Stock and the majority of warrants into common stock, effectively eliminating market overhang from variable-priced warrants. This simplification has been further enhanced by the full repayment of all bridge notes, leaving only a small number of fixed-price warrants with an exercise price of USD 20. As of the current date, the total number of shares outstanding is 17,606,739. These measures have substantially increased the appeal of Allarity's stock to investors.
• Financial Position and Compliance: Allarity Therapeutics has demonstrated robust financial health, with a cash balance of USD 14 million and stockholders' equity of USD 15 million, exceeding the USD 2.5 million minimum required by Nasdaq under Listing Rule 5550(b)(1). This strengthened financial position was achieved through an "At-The-Market" (ATM) offering under a Form S-3, which provided a swift and cost-effective method of raising capital ahead of Nasdaq's May 14, 2024, deadline. The company is now seeking formal confirmation from Nasdaq that it has regained compliance with the rule.
• Clinical Development Progress: The company has achieved a major milestone in its clinical development by concluding its Phase 2 trial of stenoparib ahead of schedule due to positive clinical outcomes. The trial, which targeted heavily pre-treated ovarian cancer patients using Allarity's DRP® companion diagnostic, demonstrated significant tumor shrinkage and prolonged disease stability. These encouraging results have led Allarity to halt further enrollment to prepare for a follow-on trial with FDA regulatory intent. The company is planning to provide additional details in an upcoming clinical update.
• Strategic Focus and Cost Management: Allarity Therapeutics has strategically refocused its efforts on advancing the development of stenoparib for advanced, recurrent ovarian cancer, driven by the promising results from the Phase 2 trial. This shift in focus has allowed the company to streamline its operations, resulting in significant cost reductions. As part of this strategic realignment, the company has deprioritized other projects, such as the development of IXEMPRA® and dovitinib, to better align with its new priorities.
• First Quarter 2024 Financial Results: In the first quarter of 2024, Allarity reported Research and Development (R&D) expenses of USD 2.2 million, an increase from USD 1.4 million in the same period of 2023. This rise in R&D costs was largely due to higher manufacturing expenses and an extension fee related to the license agreement for stenoparib. General and Administrative (G&A) expenses decreased slightly to USD 2.1 million from USD 2.2 million in the previous year, reflecting lower insurance and professional fees. Despite these changes, the net loss from operations increased to USD 4.2 million, compared to USD 3.7 million in the first quarter of 2023, resulting in a net loss of USD 3.8 million for the quarter, up from USD 3.4 million in the same period last year.

Individuals can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest taking into consideration the risk-reward scenario. 

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing.

Related Risk: This report may be looked at from a high-risk perspective and a recommendation is provided for a short duration. This report is solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc. 

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance level is August 09, 2024. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Target Price refers to a price level that the stock is expected to reach as per the relative valuation method and or technical analysis taking into consideration both short-term and long-term scenarios.s

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