Struggling Capstone delays key data analysis on lead drug

After racking up $134.3 million in losses over the past seven years, Tempe, AZ-based Capstone Therapeutics ($CAPS) is delaying the release of data from a mid-stage study of its lead drug and struggling to avoid being delisted as its shares trade well below the $1 minimum.

Capstone, which had changed its name from OrthoLogic, came into some national attention just a year ago when the New York Times profiled its novel effort to give its shareholders an option to withdraw their portion of the company's liquidation value by the middle of this year. With high hopes for the mid-stage study of the scar reduction drug AZX100, Capstone was gambling that shareholders would be persuaded to stick with the company in the event the data was good. And if it was bad, then they could make a clean break.

Now, the company reports that the Phase IIa data is being delayed "due to the size and complexity of the dataset... The company will report these results as soon as practicable."

The Phoenix Business Journal, meanwhile, reports that Capstone is considering a reverse stock split to keep its shares, now trading at 42 cents, on Nasdaq. Capstone had $11.7 million in cash and equivalents on the books on September 30, 2010.

- read the Capstone release
- here's the story from the Phoenix Business Journal