Obalon Therapeutics, Inc. (NASDAQ: OBLN ), a vertically integrated weight loss solutions company commercializing the first and only FDA-approved swallowable, gas-filled intragastric balloon system for the treatment of obesity, announces that its Board of Directors has decided to explore potential financial and strategic alternatives intended to enhance stockholder value. The Company has engaged Canaccord Genuity LLC as its financial advisor. Th
SAN DIEGO, March 25, 2020 (GLOBE NEWSWIRE) -- Obalon Therapeutics Inc. (NASDAQ:OBLN), a vertically integrated weight loss solutions company commercializing the first and only FDA-approved swallowable, gas-filled intragastric balloon system for the treatment of obesity, announces that its Board of Directors has decided to explore potential financial and strategic alternatives intended to enhance stockholder value. The Company has engaged Canaccord Genuity LLC as its financial advisor.
The overall uncertainty, the restriction on elective procedures and the specific directives issued by the Governor of California regarding Covid-19 has had an immediate impact on Obalon’s business. As previously announced, patients who are already in treatment with the Obalon Balloon System at the retail treatment centers will continue to receive full care, but sales to new patients have been halted. This is particularly disappointing as the San Diego center had generated an average of approximately 30 new patient sales per month for the three months preceding the Covid-19 crisis, which annualizes to a run-rate approaching $2 million of gross patient sales in that center alone.
As a result of the California directives, the Company has also halted manufacturing operations. Although Obalon believes it has enough inventory to provide balloons for all patients currently in treatment, it does not believe it will be able to ship new orders to its international distributors or U.S. customers in Q2-20.
The impact of the Covid-19 crisis has significantly impacted Obalon’s stock price, stockholder value and its ability to access additional capital. Although Obalon ended December 31, 2019 with $14 million in cash and equivalents and believes it can meet its current financial obligations and liabilities, Obalon’s Board of Directors has determined that it is in the best interest of stockholders to explore potential financial and strategic alternatives at this time. Potential financial and strategic alternatives may include, among others, an equity or debt financing, a sale of the company, a business combination, or a merger or reverse merger with another party. No assurance can be given as to whether any particular action or transaction will be undertaken; however, Obalon intends to assess all viable paths to potentially enhance stockholder value. The Company does not intend to make any further public announcements regarding its strategic review unless or until its Board of Directors has approved a transaction or otherwise determined that further disclosure is appropriate or required by law.
About Obalon Therapeutics, Inc.
Obalon Therapeutics, Inc. (NASDAQ:OBLN) is a San Diego-based company focused on developing and commercializing novel technologies for weight loss. For more information, please visit http://www.obalon.com.
Cautionary Statement Regarding Forward-Looking Statements
This press release contains forward-looking statements that are not purely historical regarding Obalon’s or its management’s intentions, beliefs, expectations and strategies for the future, including those related to new products and their potential benefits and those related to potential financial and strategic alternatives. All forward-looking statements and reasons why results might differ included in this press release are made as of the date of this release, based on information currently available to Obalon, deal with future events, are subject to various risks and uncertainties, and actual results could differ materially from those anticipated in those forward looking statements. The risks and uncertainties that may cause actual results to differ materially from Obalon’s current expectations are more fully described in Obalon’s annual report on Form 10-K for the period ended December 31, 2019 and its other reports, each as filed with the Securities and Exchange Commission. Except as required by law, Obalon assumes no obligation to update any such forward-looking statement after the date of this report or to conform these forward-looking statements to actual results.
For Obalon Therapeutics, Inc.
Investor Contact:
Bill Plovanic
President and Chief Executive Officer
Obalon Therapeutics, Inc.
Office: +1 760 607 5103
wplovanic@obalon.com
