Rockwell Medical, Inc. — financial distress indicators
Financial-health summary
Rockwell Medical, Inc.'s reported numbers place it in the 'Watch' financial-health band (distress score 38/100). The main indicators are revenue collapse, operations consume cash and ohlson o-score signals likely failure. Independently, the Ohlson accounting model puts its 1-year failure probability at 52% and the market-implied (Merton) default probability is 4.9%. In its favour: cash on hand covers all debt (net-cash balance sheet).
Stress by dimension
Share price — last 12 months
Indicators behind the score
Each red flag shows the evidence from the company’s own filings and the financial or legal principle behind it. Points add to the 0–100 score.
Revenue changed -32% year over year.
A >30% sales drop typically breaches leverage covenants and starves fixed-cost coverage.
Operating cash flow negative in 2 of the last 3 years.
A business that cannot fund itself from operations depends on external capital to survive.
O-score 0.08 → model probability 52%.
Ohlson (1980) logit model of 1-year corporate failure; O > 0 (p > 50%) is the original failure cut-off.
Net income negative in 3 of 3 fiscal years. Partly offset by positive operating cash flow and net cash.
Persistent losses erode equity and the capacity to absorb shocks.
Revenue vs net income
Cash generation
Debt vs cash vs equity
✅ Mitigating factors
- Cash on hand covers all debt (net-cash balance sheet).
- Operating cash flow is positive over the latest 12 months.
- Strong current ratio (3.74).
📰 Recent news scan
- Rockwell Medical Ranked No. 16 on the 2026 Fortune ‘Best Workplaces in Manufacturing & Production’ ListYahoo Finance · 2026-10-07
- Minot Light’s Bullish Stance on Rockwell Medical (RMTI)Yahoo Finance · 2026-09-22
- Rockwell Medical (RMTI) Q2 2026 Earnings Call TranscriptYahoo Finance · 2026-08-14
- Rockwell Medical Inc (RMTI) (Q2 2026) Earnings Call Highlights: Revenue Up 11% and Cash Flow ...Yahoo Finance · 2026-08-13
- Rockwell Medical (RMTI) Reports Q2 Loss, Lags Revenue EstimatesYahoo Finance · 2026-08-13
- Rockwell Medical Announces Second Quarter 2026 ResultsYahoo Finance · 2026-08-13
⚖️ U.S. legal pathway — Title 11, U.S. Code
Which chapter would apply?
- Chapter 11 — reorganisation. Management usually stays in control as debtor-in-possession; the automatic stay (§362) halts collection; a plan must meet the best-interests test (§1129(a)(7)) and the absolute priority rule (§1129(b)) — creditors are paid before shareholders, who are frequently wiped out.
- Chapter 7 — liquidation. A trustee sells assets and distributes proceeds by statutory priority (§§507, 726).
- Subchapter V (“Chapter 5”) is a fast track for small-business debtors under a statutory debt cap, but SEC-reporting companies are excluded (§101(51D)) — so it rarely applies to listed companies.
What typically triggers a filing
- Payment default or covenant breach lenders will not waive; a debt maturity that cannot be refinanced.
- Auditor going-concern doubt (ASC 205-40 / PCAOB AS 2415) — often itself a default trigger in loan agreements.
- Creditors can force a case with an involuntary petition (§303) if debts are not paid as they come due.
- Delisting after sustained sub-$1 prices or equity deficits cuts off equity funding.
Transactions shortly before filing can be clawed back (preferences — 90 days, §547; fraudulent transfers — 2 years, §548).
Frequently asked questions
What do Rockwell Medical, Inc.'s financial-health indicators show?
As of 2026-10-08, Rockwell Medical, Inc.'s public financial data places it in the 'Watch' band with a distress score of 38/100, driven by revenue collapse, operations consume cash and ohlson o-score signals likely failure. This is a statistical screen of reported numbers — it does not mean the company is insolvent, has defaulted or will enter insolvency proceedings.
What is Rockwell Medical, Inc.'s financial distress score?
38/100 ('Watch'). Ohlson O-score 0.08 (model 1-year failure probability 52%). Merton distance-to-default 1.66 σ (model default probability 4.9%).
What works in Rockwell Medical, Inc.'s favour?
Cash on hand covers all debt (net-cash balance sheet). Operating cash flow is positive over the latest 12 months. Strong current ratio (3.74).
How are shareholders treated if a company enters insolvency?
In a Chapter 11 reorganisation the absolute priority rule pays secured lenders, then unsecured creditors, before shareholders — so existing shares are usually cancelled or heavily diluted. In Chapter 7 the company is liquidated and shareholders rarely recover anything.
Other Pharma & Biotech companies with distress indicators
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- AKAN (AKAN)Very weak 100/100
- Endovia Health Sciences, Inc. (EDVA)Very weak 100/100
- Elicio Therapeutics, Inc. (ELTX)Very weak 100/100
- IM Cannabis Corp. (IMCC)Very weak 100/100
- NeuroSense Therapeutics Ltd. (NRSN)Very weak 100/100
Methodology
Score = capped sum of rule-based red flags across seven dimensions (liquidity, solvency, profitability, cash flow, sales trend, market signal, news). Ohlson O-score (1980) gives an accounting-based 1-year failure probability; Merton distance-to-default (Bharath & Shumway 2008) gives a market-implied probability. Financial institutions use a capital-based rule set. Recalculated every trading day from the latest filings, prices and news.