Icagen's stock debuted on Wall Street in February 2005, one of the last Triangle companies to go public before the stock market slumped.
Led by CEO and co-founder P. Kay Wagoner, the Durham company sold 5 million shares at $8 each, raising millions of dollars to further develop its experimental drugs to treat diseases such as epilepsy and asthma.
But Icagen fell out of favor on Wall Street when its treatments didn't live up to their promise. Now the company's shares risk being delisted by Nasdaq because they've traded below a dollar since early October.
The company reported late Friday that it has until May 11 to get its shares above $1 for a minimum of 10 consecutive days or itfaces delisting. Icagen can appeal a delisting ruling and could get 180 additional days to comply, but that's not a guarantee.
Icagen officials "will consider available options" if the stock doesn't rise above $1. That could include seeking shareholder approval for a reverse stock split, which would essentially raise the stock price by reducing the number of shares outstanding, Chief Financial Officer Richard Katz said.
"There are a lot of positive things that could happen in the first half of 2010 that could get the stock back up on its own," he added. That includes results expected from tests of two experimental drugs, one to treat epilepsy, and one for pain. Positive data on one or both could boost Icagen's standing on Wall Street.
In addition, Pfizer, the world's largest drugmaker, is Icagen's biggest investor, and the companies are working together on new treatments for pain. That partnership brings Icagen nearly $5 million a year, Katz said, and could lead to promising breakthroughs that also would boost Icagen's shares.
"I'm painfully aware that the stock has not done well," Katz said, noting that most of the company's employees own shares. "We think our company has some very promising science." Katz owns nearly 300,000 shares, according to Bloomberg News.
The Nasdaq waived its minimum price rule for much of the past year as stocks dropped sharply. But market officials have recently started notifying companies that they must regain compliance.
Icagen shares closed Monday unchanged at 48 cents.
On Nov. 5, the company reported that it lost $3.5 million during the third quarter. Revenue fell 29 percent from the same period last year to $2.2million.
The company continues "to implement a number of cost reduction initiatives in an effort to conserve capital," Wagoner said in a prepared statement. Icagen had $21.1 million in cash as of Sept. 30, enough to finance operations for about a year.
The cost cuts included reducing its work force about 10percent, Katz said. The company now employs about 60 people.
Wagoner, who earned her doctorate in physiology from UNC-Chapel Hill, co-founded Icagen in 1992 and has been CEO since 1996. She also owns nearly 1 million Icagen shares, Bloomberg reports.
One of Icagen's largest investors, Xmark Opportunity Partners, has pushed the company's management to consider a sale or other steps to boost shareholder value.
