Fortress Biotech Pauses Dividends on Series A Preferred Stock

Fortress Biotech, Inc., headquartered in Miami and listed on Nasdaq under the ticker symbols FBIO and FBIOP, has decided to suspend the payment of dividends on its 9.375% Series A Cumulative Redeemable Perpetual Preferred Stock. This decision, effective from July 1, 2024, was made by the company's Board of Directors as a strategic move to preserve financial flexibility in anticipation of several significant potential milestones.

The dividends on the Series A Preferred Stock will continue to accumulate until they are either authorized or declared. As a result, no dividend will be paid on July 31, 2024. The company has outlined that this suspension will help defer approximately $0.7 million in monthly cash dividend payments. The Board will periodically review this suspension, considering the company's profitability and cash flow to determine the appropriate time to reinstate the dividend payments.

Lindsay A. Rosenwald, M.D., Fortress' Chairman, President, and CEO, highlighted several upcoming regulatory approvals that the company anticipates could occur within the next year. These include potential approvals for DFD-29, cosibelimab, and CUTX-101, with the possibility of a BLA filing for CAEL-101 as early as 2025. AstraZeneca, one of Fortress' partners, has publicly stated that it expects the FDA to review the BLA submission for CAEL-101 by 2025, which could lead to approval and subsequent commercial milestone payments to Fortress. Furthermore, Fortress' subsidiary, Cyprium Therapeutics, will maintain complete ownership over any priority review voucher issued upon NDA approval for CUTX-101.

Fortress Biotech is a dynamic biopharmaceutical firm committed to enhancing long-term shareholder value through various revenue streams including product sales, equity holdings, and royalty revenue. The company currently markets seven prescription pharmaceutical products and has over 20 development programs. These programs span multiple therapeutic areas such as oncology, dermatology, and rare diseases and are being advanced by Fortress, its majority-owned and controlled affiliates, and other partnered entities where Fortress holds significant minority stakes.

The company's business model leverages its extensive expertise and network within the biopharmaceutical industry to identify and develop promising product opportunities. Fortress has established collaborations with renowned academic institutions and biopharmaceutical companies, such as AstraZeneca, City of Hope, Fred Hutchinson Cancer Center, Nationwide Children's Hospital, and Sentynl. These partnerships are designed to maximize the potential of each development opportunity.

Fortress' decision to pause the dividend payments reflects its strategy to retain financial flexibility and focus resources on upcoming milestones that could have a significant impact on its growth trajectory. The company remains committed to revisiting this decision regularly, ensuring that the best interests of the company and its stakeholders are maintained.

Overall, this move by Fortress Biotech underscores its proactive approach in managing its financial resources while navigating through a pivotal phase marked by multiple potential regulatory approvals and product advancements.