NASDAQ:SLRX
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Salarius Pharmaceuticals (NASDAQ:SLRX) continues to pursue a “strategic alternative” and continues to cut costs in order to extend its resources. We continue to be disappointed in this announcement as we continue to believe in the science behind the treatments being developed by Salarius but we are pleased to see the company continuing the process of pursuing FDA approval for its important treatment. We also want to note that the company continues to hold solid cash balances that should let it continue to operate on a limited basis for the foreseeable future. The company’s recent annual report reported almost $6 million in cash on its balance sheet. Additionally, the company’s cost-cutting efforts are seen in the annual report, with expenses for various categories being greatly reduced and the CEO moving from a full-time employee to a part-time consultant in order to conserve cash.
Despite the financial challenges the company is facing, progress continues to be made, making us believe that investors should continue to look at SLRX as a cash infusion or acquisition appears quite possible to us. As a reminder, the company’s signature drug, SP-2577, is currently being tested for the treatment of Ewing sarcoma, which currently has no targeted therapies. The company recently announced that a Ewing sarcoma patient that was treated with SP-2577 and saw at least a 30% decrease in the size of the patient’s target lesions, bringing the objective response rate (ORR) in Ewing sarcoma first-relapse patients to 60%, with a 60% disease control rate (DCR). This is another example of the potential of the science behind Salarius and why we believe investors will be interested in the company.
We understand that funding has become more difficult in recent months as credit markets have tightened and that it takes large capital resources to shepherd a treatment through the FDA approval process. We remain of the belief, and hope for potential patients, that Salarius will either find the resources needed or be acquired by an entity that has the resources to continue the work that Salarius has undertaken. We continue to believe, based on the data that we’ve seen to this point, that the treatment being developed by the company could have the opportunity to provide hope to those suffering from conditions with few acceptable treatment options available.
We also believe that this was a difficult decision for management of Salarius to come to, especially after recently announcing the FDA approval of its Phase 1 trial of its treatment known as SP-3164. But if the company was going to be unable to continue in the testing and approval process, we believe it was the correct decision to make. We also want to note that the company has notified shareholders of a special meeting on May 9, 2024, in order to give approval to the board of directors to affect a reverse stock split in the 1:4 to 1:8 range at the board’s discretion.
Where does that leave investors? As we’ve written about extensively, we continue to be confident in the treatments being developed and that Salarius makes an attractive investment opportunity for private equity or an acquisition by a larger pharma company looking to bolster their pipeline. We obviously can’t know how this will work out, or if an investment will even be forthcoming, but we believe the attractiveness of the assets still makes Salarius a valuable company to an investor.
We continue to believe that SLRX can provide value to investors at recent prices due to our view that the assets, including intellectual capital, of the company will be of value to a variety of investors, but with credit markets tightening, risks have risen, and only those with a higher risk tolerance should take a look at SLRX.
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