Clinical-stage biotech company, Atossa Therapeutics (NASDAQ:ATOS) is witnessing some blows being cash strapped and taking desperate measures for getting operating capital. Investors are always look to put money into biotech stocks, considered as hypergrowth plays, with U.S Food and Drug Administration rulings and patents being around the corner.
Seattle based company Atossa, specialising in therapeutic treatment of breast cancer, has been on investor’s radar in the last year as it moved focus on treating Covid-19 as well. The firm is carrying on clinical trials abroad, while its shares surged as it announced on July 30, 2021 on shareholder meeting for early September.
The meeting will see shareholders of the company vote for approving contentious amendment on its certificate to incorporation. If it gets approved, the cumulative common shares will increase by 100 million facilitating in the company’s want for operational funds. At the moment, Atossa’soperating cash flow is $12.75 million loss.
Stock dilution is perceived negatively by most investors and the meeting announcement is leading to losses for its shares already. The company’s shares plummeted by about 21% since the news and more than 34 million shares have been traded, significantly higher than the daily average of 21 million.