SLS Stock Hits 1-Month Low On China Arbitration Blow — Retail Bulls Call It A ‘Nothingburger’ Ahead Of AML Readout

Sellas estimated cash and cash equivalents of $138.3 million as of June 30.

• The arbitrator dismissed Sellas’ $13 million milestone claims and ordered it to pay about $1 million in legal fees and costs.
• Sellas’ China licensing deal remains intact, with $191.5 million in potential future milestones still available, including the disputed $13 million.
• The Phase 3 Regal AML trial has reached 78 of 80 events needed for final analysis, leaving just two events to go.

Shares of Sellas Life Sciences Group (SLS) fell to a one-month low on Monday after the biotech firm lost its arbitration case against China partner 3D Medicines, but investors are already turning their attention back to the company’s closely watched Phase 3 leukemia trial.

SLS stock fell 4% on Monday to $10.84, extending its losing streak to two days.

Sellas Loses $13M China Arbitration 

In a fresh regulatory filing from Monday, Sellas said that the sole arbitrator dismissed its claims against 3D Medicines and ordered the company to pay about $1 million toward the Chinese biotech’s legal fees and costs. The dispute is related to $13 million in milestone payments for Galinpepimut-S (GPS), Sellas’ cancer immunotherapy candidate.

The broader China partnership, however, remains intact. 3D Medicines said it will continue developing and commercializing GPS in Greater China, while $191.5 million in potential future milestone payments remain under the agreement, including the disputed $13 million.

The dispute stems from Sellas’ 2020 licensing agreement granting 3D Medicines Greater China rights to GPS and SLS009, Sellas’ second clinical-stage cancer therapy.  Sellas launched the arbitration in December 2023, saying that $13 million in milestone payments had become due after GPS advanced into Phase 3 development. It also alleged that 3D Medicines had not devoted sufficient resources to advancing the program in Greater China, particularly mainland China. However, 3D Medicines rejected the claims as “groundless.”

The filing also revealed that Sellas estimates it had $138.3 million in cash and cash equivalents as of June 30.

Sellas Nears Key Phase 3 AML Readout 

Sellas is nearing its most important clinical catalyst, which is Regal, its Phase 3 trial evaluating GPS as maintenance therapy in patients with acute myeloid leukemia (AML). The event-driven study has reached 78 of the 80 events needed to trigger final analysis, leaving it just two events away from completion.

CEO Angelos Stergiou has previously said slower-than-expected event accumulation is encouraging since the trial’s primary endpoint is overall survival. Sellas has said that Regal would be considered successful if GPS extends median overall survival to 12.6 months versus 8 months with standard treatment.

How Do Retail Traders Feel About SLS?

Retail traders largely brushed off the arbitration setback, saying that the core SLS thesis is still based on Regal, cash runway and future milestone potential. Sentiment on Stocktwits has been ‘bearish’ over the past week amid a 355% surge in 24-hour message volumes. 

One user urged investors to “read the 8-K instead of the Bear headlines,” pointing to the $138.3 million cash balance, continued GPS development in China and the remaining $191.5 million in potential milestones. Another called the ruling a “nothingburger,” saying that the biggest update was the company’s cash position rather than the loss of the arbitration claim.

A third trader emphasized that the China license remains intact and said attention should now return to Regal. Some bulls went further, speculating that resolving the arbitration could clear one source of uncertainty around a possible partnership or acquisition. The speculation has also been fueled by Stergiou’s recent LinkedIn reference to “collaborators, strategic partners, and shareholders,” as well as updated change-of-control terms for senior executives. 

SLS stock has surged 502% over the past year. 

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