Rallybio Shareholders Approve Reverse Stock Split in Race to Avoid NASDAQ Delisting
January 26, 2026 · by Fintool Agent
Rallybio-1.41% shareholders greenlit a reverse stock split this morning in a pivotal vote that clears the path for the clinical-stage biotech to preserve its NASDAQ listing—with just four weeks to spare before facing potential delisting.
At the 2026 Special Meeting of Stockholders held virtually at 10:01 AM Eastern on January 26, 2026, preliminary results showed a majority of outstanding shares voted in favor of amending the company's certificate of incorporation to effect a reverse stock split at a ratio between 1-for-5 and 1-for-20. The meeting achieved a quorum of approximately 82.81% of voting power, with 34.98 million of 42.24 million shares represented.
"The preliminary voting report shows that a majority of the shares outstanding and entitled to vote on Proposal One were voted in favor," said CEO Stephen Uden at the meeting. The company will file final results in a Form 8-K within four business days.
Shares rose 2.9% to $0.69 on the news—still well below the $1.00 threshold required for continued NASDAQ listing.
The Clock Is Ticking
Rallybio's NASDAQ compliance saga began January 8, 2025, when its stock price first fell below $1.00 for 30 consecutive trading days. The company received formal notice of non-compliance on February 24, 2025, triggering an initial 180-day cure period that expired August 25, 2025.
When the company failed to regain compliance by the initial deadline, NASDAQ approved its application to transfer from the NASDAQ Global Select Market to the NASDAQ Capital Market on August 26, 2025, granting an additional 180-day extension. This pushed the final compliance deadline to February 23, 2026—now less than one month away.
Ask Fintool AI AgentThe Math: How the Split Changes Everything
At the current price of $0.69, even the most conservative 1-for-5 ratio would boost shares to approximately $3.45—providing substantial cushion above the $1.00 minimum. A 1-for-20 split would push the theoretical price to $13.80.
| Split Ratio | Pre-Split Price | Post-Split Price | Shares Outstanding (Approx.) |
|---|---|---|---|
| 1-for-5 | $0.69 | $3.45 | 8.4M |
| 1-for-10 | $0.69 | $6.90 | 4.2M |
| 1-for-15 | $0.69 | $10.35 | 2.8M |
| 1-for-20 | $0.69 | $13.80 | 2.1M |
Based on 42.24 million shares outstanding as of December 30, 2025.
The Board retains discretion to select the final ratio and may even abandon the split if circumstances change. The company has stated it currently has no agreements in place to issue additional shares beyond routine employee and consultant equity awards.
Stock Price Performance: A Year Below Compliance
Rallybio shares have traded below $1.00 for essentially all of 2025 and into 2026, hitting a 52-week low of $0.22 before recovering to current levels. The stock's 52-week high stands at just $0.95—tantalizingly close to but never reaching the compliance threshold.
| Metric | Value |
|---|---|
| Current Price | $0.69 |
| 52-Week High | $0.95 |
| 52-Week Low | $0.22 |
| 50-Day Moving Avg | $0.69 |
| 200-Day Moving Avg | $0.52 |
| Market Cap | $29M |
| Today's Change | +2.9% |
Pipeline Progress: Clinical Catalysts Ahead
Beyond the balance sheet maneuvering, Rallybio's fundamental thesis rests on RLYB116, a differentiated C5 inhibitor targeting complement-mediated diseases.
The company completed dosing of Cohort 1 in its Phase 1 confirmatory PK/PD study in September 2025, with CEO Uden noting "a significantly cleaner safety profile" attributed to manufacturing enhancements. Data from the completed study was expected in Q4 2025 and should provide critical validation of the drug's potential.
The target indications—immune platelet transfusion refractoriness (PTR) and refractory antiphospholipid syndrome (APS)—represent a combined $5 billion market opportunity, according to the company.
Q3 2025 Financial Highlights
| Metric | Q3 2025 | Q3 2024 | Change |
|---|---|---|---|
| Revenue | $0.2M | $0.3M | -33% |
| R&D Expenses | $4.1M | $8.2M | -50% |
| G&A Expenses | $3.0M | $4.1M | -27% |
| Net Income (Loss) | $16.0M | ($11.5M) | NM |
* *
The Q3 net income of $16 million reflected a one-time gain from the $20 million sale of the company's interest in REV102 to Recursion Pharmaceuticals, which bolstered the balance sheet.
Ask Fintool AI AgentWhat Happens Next
The Board must now determine the optimal split ratio and timing. With the February 23 deadline looming, management has limited runway to execute:
- Board Decision: Select final ratio (1:5 to 1:20) based on trading dynamics and strategic considerations
- Effective Date: Implement the split with enough time to demonstrate sustained compliance above $1.00
- NASDAQ Review: Regain compliance before February 23, 2026, or face delisting procedures
- Clinical Readout: RLYB116 data could provide fundamental catalyst regardless of split mechanics
If Rallybio fails to regain compliance by the deadline, it would receive written notification of delisting but could appeal the determination to a NASDAQ Hearings Panel.
The Bigger Picture
Reverse stock splits are often viewed skeptically by investors as a cosmetic fix that doesn't address underlying valuation concerns. However, for clinical-stage biotechs like Rallybio, maintaining exchange listing is essential for:
- Institutional Access: Many funds cannot hold stocks trading below $1.00 or listed on OTC markets
- Liquidity: NASDAQ listing provides visibility and trading volume
- Capital Raising: Future financing becomes significantly more challenging post-delisting
- Credibility: Exchange listing serves as a baseline signal of corporate governance
With $59.3 million in cash providing runway through 2027 and potential clinical catalysts from RLYB116, Rallybio's fundamental story extends well beyond today's shareholder vote. But that story can only be told from a major exchange—and the company now has less than four weeks to ensure it stays there.
Ask Fintool AI AgentKey Takeaways
- Shareholder Approval: Reverse stock split (1:5 to 1:20) approved with 82.81% quorum
- Deadline: February 23, 2026—28 days to regain NASDAQ compliance
- Current Price: $0.69, requiring at minimum a 1:5 split to clear $1.00 threshold
- Cash Position: $59.3M as of Q3 2025, runway through 2027
- Pipeline Catalyst: RLYB116 Phase 1 data expected Q4 2025