BioXcel Therapeutics, Inc., a pharmaceutical company based in New Haven, Connecticut, has made significant changes to its executive compensation structure amid challenging financial conditions.
According to InvestingPro data, the company's market capitalization stands at just $23.39 million, with an EBITDA of -$73.91 million in the last twelve months. On Monday, the company announced amendments to the employment agreements of its top executives, including President and CEO Vimal Mehta, PhD, and CFO Richard Steinhart.
According to the amendments, Dr. Mehta's cash compensation for 2025 will be reduced to $706,558. Additionally, he has been granted options to purchase 660,000 shares of the company's common stock at a time when the stock has declined over 83% in the past year. These options are part of the company's 2020 Incentive Award Plan and will vest monthly over a twelve-month period.
Similarly, CFO Richard Steinhart's cash compensation for 2025 has been adjusted to $289,800, and he has been awarded options to purchase 270,000 shares of BioXcel's common stock. Chief Scientific Officer Frank Yocca also saw a reduction in his 2025 cash compensation to $290,500 and was granted the same number of stock options as Steinhart.
The exercise price for the options granted to all three executives is set at $0.4713 per share. The company's stock is traded on The Nasdaq Capital Market under the ticker symbol NASDAQ:BTAI. InvestingPro analysis reveals the company is currently burning through cash rapidly and operating with a significant debt burden. For detailed insights into BioXcel's financial health and more exclusive ProTips, investors can access the comprehensive Pro Research Report, available to InvestingPro subscribers.
These amendments reflect a strategic move by BioXcel Therapeutics to adjust the compensation of its key executives. The company has filed the full text of these amendments with the Securities and Exchange Commission, which provides the basis for this report.
In other recent news, BioXcel Therapeutics has experienced significant financial and strategic developments. BofA Securities downgraded the company's stock from Neutral to Underperform, reflecting a cautious outlook for the biopharmaceutical company over the next year. This downgrade comes amidst concerns over BioXcel's financial standing and the outcomes of its ongoing clinical trials, including the SERENITY and TRANQUILITY studies.
Additionally, Canaccord Genuity (TSX:CF) reduced its price target for BioXcel Therapeutics shares to $5 while maintaining a Buy rating. This adjustment follows the company's renegotiation of financial covenants and a recent capital raise.
BioXcel Therapeutics has also made substantial modifications to its credit agreement, including the issuance of new warrants to lenders and adjustments to its capital raising requirements. The company is required to secure a series of funds tied to the outcomes of its SERENITY At-Home Phase 3 trial.
Furthermore, the company reported a decrease in its Q3 2024 net revenue to $214,000, but the nine-month revenue increased to $1.9 million, and the net loss was significantly reduced to $13.7 million. This financial performance led Mizuho (NYSE:MFG) Securities to maintain its Neutral rating on BioXcel, citing low sales of the drug Igalmi and higher operating expenses.
Finally, BioXcel is progressing with its clinical trials, including two pivotal Phase 3 trials for drug candidate BXCL501 and the SERENITY At-Home study for Igalmi. These are among the recent developments shaping BioXcel's trajectory as the company addresses its immediate liquidity challenges and supports its ongoing clinical trials.
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