Biotechnology company IBio Inc. (NYSE: IBIO) has indicated that without more cash, it faces the threat of liquidation.

The company raised doubt about continuing as a going concern, or without the threat of liquidation, in a May 20 10-Q filing with the U.S. Securities and Exchange Commission, saying the status is caused by a history of losses, negative cash from operations and limited cash resources.

It is also facing being delisted from the stock exchange because of the company’s significant losses.

IBio develops technology to produce plant-derived vaccines and other products through its iBioLaunch service. The company’s products are used in vaccines and medications being developed to treat the H1N1 flu virus, Yellow Fever, Marlaria, Human Papillomavirus and Alpha-Galactosidase.

On April 18, Newark, Del.-based IBio received a notice from the New York Stock Exchange indicating that it was below some of the exchange’s listing standards. The standards in question, set forth in Section 1003 (iv), apply if a listed company has sustained losses that are so substantial in relation to its overall operations or its financial resources, or its financial condition has become so impaired that it is questionable as to whether the listed company will be able to meet its obligations as they mature. 

The NYSE accepted the company’s plan of compliance and granted it an extension to regain compliance through Oct. 14.  

During the extension period, IBio will be subject to periodic review by the NYSE staff.

Since IBio was spun off from Integrated BioPharma Inc. in August 2008, it has incurred significant losses, the company says in an SEC filing. 

As of March 31, IBio’s accumulated deficit was about $36.2 million. As of March 31, the company had $1.5 million in cash on hand, which it expected to get it through the second quarter.

IBio says that it plans to fund operations through proceeds from the sale of additional equity or other securities and through proceeds from license collaboration agreements. If the company issues more equity securities, IBio stockholders may experience dilution.

The company closed a public offering for about 8.9 million shares of common stock and warrants to buy up to 3.57 million shares of common stock on April 26, bringing in about $3.8 million in proceeds. IBio plans to use that money for working capital.

For the three months ended March 31, the company had no revenue, compared with $400,000 it brought in for the first quarter of 2012.

IBio’s biggest contractual agreement is its technology transfer agreement with Fraunhofer USA Inc., which requires IBio to make $10 million in non-refundable payments to Fraunhofer in semi-annual installments through 2014 for Fraunhofer’s research and development services.

The company is in talks with Fraunhofer and FioCruz, which has engaged IBio to develop a yellow fever vaccine, to modify a work plan. Until those negotiations are over, IBio won’t bring in revenue related to its work for FioCruz, the company says in SEC filings.

Requests for comment from IBio were not returned. 

For the last edition of Turnaround Tuesday, see “China Precision Steel Continues Talks with Lenders After Defaults.” 

For more distressed companies, see Mergers & Acquisition’ Distressed Company Watch List

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