The San Diego-based company, which produces an FDA-approved swallowable, gas-filled intra-gastric balloon for weight loss, had previously cut its debt to Pacific Western Bank from $20 milllion to the remaining $5 million in July, while also announcing that it added $8.8 million to its coffers.
Obalon said that, in addition to removing the risks and restrictions of carrying long-term debt, the payoff also eliminates approximately $350,000 in annual interest expenses.
The company separately announced that it believes it has regained compliance with NASDAQ listing rule 5450(b)(1)(A) by increasing its stockholder’s equity above the minimum requirement for continued listing.
“We are pleased to continue to transform the Company’s financial position and believe that with no long-term debt and our current cash position we are well-positioned to drive our strategy to bring the Obalon balloon system to patients in need of a proven weight loss solution,” president & CFO William Plovanic said in a news release. “We remain focused on converting consumer interest in our novel FDA-approved balloon system into patient treatments and successful weight loss experiences, and we are looking forward to the first patient treatments at our Company-owned and managed Obalon Center for Weight Loss.”
Shares of OBLN were down -8.7% at $1.79 per share in mid-afternoon trading today.