Maxim cuts Cytori Therapeutics to hold, removes PT

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Maxim Group downgraded Cytori Therapeutics (NASDAQ:CYTX) to “hold” from “buy” and removed its price target, citing capital concerns. The stock closed at 40 cents on August 14.

“Our fundamental view around the company's key programs of 0918 (liposomal doxorubicin) and cell therapy (scleroderma, stress urinary incontinence) are unchanged, but capital constraints remain, and are an increasing concern,” writes analyst Jason McCarthy. 

He figures Cytori currently has about $8-million in cash, including $5.7-million in net proceeds from a July financing. A combination of operating expenses and debt service leaves cash runway into early in the first quarter of 2019, he added. 

In addition, he said the company has about $14-million in debt that must be refinanced prior to the initial payments due on Sept. 1. “If not, the cash runway extends only to November,” he noted. “In either case, Cytori again faces a financing overhang. However, partnerships, particularly around 0918 could potentially extend the runway,” he added.

Michelle Carr