Fresh Tracks expects to distribute $5M to $7M to shareholders after dissolution

BOULDER — Fresh Tracks Therapeutics Inc. (Nasdaq: FRTX) shareholders are set to vote this month to dissolve the company, a move that the drug developer expects to result in $5 million to $7 million returned to those shareholders. 

The company, which laid off nearly all its workers last month, spent the third quarter focused on cost-cutting, Fresh Tracks said Monday in its third-quarter earnings report.

Last year the drug developer rebranded from Brickell Biotech and sold off rights to its excessive-sweating drug to Botanix Pharmaceuticals Ltd. The company, which has seen its stock price tank in recent years, then began exploring the possibility of a merger or other strategic options for boosting shareholder value, elevated a new CEO and paused research and development.

The company contacted about 125 potential merger partners and investors, resulting in four “unsuccessful attempts” to consummate a deal, due, Fresh Tracks said, to “the potential acquirer’s inability to secure its own necessary financing and/or inability to offer adequate value.”

Fresh Tracks’ board of directors moved to dissolve the company in September.

“Following the approval by our board of a plan of liquidation and dissolution of the company, we have taken numerous actions over the last few weeks to reduce operating expenses and conserve capital, with the primary goal of maximizing the remaining cash available to distribute to stockholders if the dissolution is approved,” Fresh Tracks CEO Albert Marchio said in a prepared statement. “As we move toward the special meeting of stockholders next week, we urge all stockholders to review the definitive proxy statement we filed with the (U.S. Securities and Exchange Commission) on Oct. 20, 2023, and encourage them to vote as soon as possible. If the dissolution is approved at the special meeting, we intend to promptly file a certificate of dissolution with the Secretary of the State of Delaware and subsequently initiate the first of several liquidating cash distributions to stockholders.”

Fresh Tracks posted sales of $7.9 million in the third quarter of 2023, up from $500,000 in the same period last year.

Net income for the most recent period was $2.1 million, an improvement over the net loss of $6 million for the third quarter of 2022.