Scinai Immunotherapeutics (NASDAQ: SCNI) experienced its best trading day on record, with shares surging 104% to $5.15 following news that the company received Italian government clearance to potentially acquire Italian biotech firm Pincell S.r.l. The regulatory approval under Italy's Golden Power regulation removes a major hurdle for the acquisition, though additional conditions must still be met before the deal's completion.
Regulatory Milestone Clears Path for Strategic Acquisition
The Italian government's approval represents a significant step forward for Scinai's planned acquisition of 100% of Pincell's share capital and voting rights. According to CEO Amir Reichman, this clearance marks "a significant step forward" in the acquisition process, which was initially agreed upon in March 2025.
However, the deal remains contingent on several conditions, including a crucial €12 million grant decision expected between mid-July and early August 2025. The company emphasized that while this regulatory approval removes a major obstacle, it does not finalize the acquisition.
PC111: Targeting Severe Dermatological Conditions
The acquisition centers around Pincell's lead drug candidate, PC111, a monoclonal antibody designed to treat rare and severe skin disorders. The therapeutic targets the Fas/FasL pathway and is being developed for conditions including Pemphigus, Stevens-Johnson Syndrome (SJS), and Toxic Epidermal Necrolysis (TEN).
PC111 has already secured Orphan Drug Designation from the European Medicines Agency, a status that provides market exclusivity and development incentives for treatments addressing rare diseases with significant unmet medical needs. This designation is particularly valuable given the limited treatment options available for these severe dermatological conditions.
Strategic Expansion for Dual-Business Model
Scinai operates through two distinct business units: one focused on developing inflammation and immunology therapies, including nanosized antibodies for diseases such as COVID-19, psoriasis, and asthma, and another providing contract manufacturing services (CDMO) for other biotech companies. The Pincell acquisition would significantly expand the company's drug development pipeline.
The company's CDMO business has shown strong revenue momentum as of Q1 2025, providing a potential steady cash flow source to support drug development activities. Recent financial improvements include a $2 million investment commitment and loan restructuring that converted $29 million of debt to equity, strengthening the company's balance sheet from negative $7.3 million to positive $10 million shareholders' equity by November 2024.
Market Response and Financial Context
The dramatic stock surge reflects investor enthusiasm for the strategic expansion, with the stock rising from a 52-week low of $1.90, though it remains below its 52-week high of $8.92. Including the session's gains, SCNI is up 54.3% year-to-date.
The company's small market cap of approximately $2.8 million as of late May 2025 contributes to the stock's volatility, with 6.18% volatility over the last 30 days. The low float and a $10 million equity purchase agreement have been cited as additional factors amplifying the price movement.
Despite recent financial improvements, Scinai reported a loss of $1.20 per share in Q2 2023, missing estimates, highlighting the ongoing challenges faced by the development-stage biotech company as it advances its therapeutic pipeline while managing cash burn typical of the industry.
