8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported): November 6, 2009

MDRNA, Inc.

(Exact name of registrant as specified in its charter)

Delaware	000-13789	11-2658569
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

3830 Monte Villa Parkway, Bothell, Washington	98021
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: 425-908-3600

Not Applicable

Former name or former address, if changed since last report

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition.

On November 12, 2009, MDRNA, Inc. (the “Company”) reported its financial results for the fiscal quarter ended September 30, 2009. A copy of the press release is furnished herewith as Exhibit 99.1 and is incorporated herein by reference.

The information contained herein and in the accompanying exhibit is being furnished pursuant to “Item 2.02 Results of Operations and Financial Condition.” The information contained herein and in the accompanying exhibit shall not be incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing, unless expressly incorporated by specific reference to such filing. The information in this report, including the exhibit hereto, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section or Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended.

Item 3.01 Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing.

On November 6, 2009, the Company received a Staff Deficiency Letter from The Nasdaq Stock Market (“Nasdaq”) notifying the Company that for the 10 consecutive trading days ending on November 5, 2009, the aggregate market value of the Company’s common stock was below the $50,000,000 minimum market value required for continued listing on the Nasdaq Global Market, as specified by Marketplace Rule 5450(b)(2).

In accordance with Marketplace Rule 5810(c)(3)(C), the Company has 90 calendar days, or until February 4, 2010, to regain compliance with the minimum market value requirement. To regain compliance, the closing market value of the Company’s common stock must equal or exceed $50,000,000 for a minimum of 10 consecutive business days or for such longer period that Nasdaq may, in its discretion, require.

If the Company does not regain compliance with the minimum market value requirement by February 4, 2010, Nasdaq will provide the Company written notification that its common stock will be subject to delisting. At that time, the Company may appeal Nasdaq’s determination to a Nasdaq Listings Qualifications Panel.

The Staff Deficiency Letter has no immediate effect on the listing or trading of the Company’s common stock on the Nasdaq Global Market.

A copy of the press release dated November 12, 2009 announcing receipt of the Staff Deficiency Letter is attached hereto as Exhibit 99.2 and incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	MDRNA, Inc.
November 12, 2009	By:	/S/    J. MICHAEL FRENCH
	Name:	J. Michael French
	Title:	Chief Executive Officer

Exhibit Index

Exhibit No.	Description
99.1	Press Release of MDRNA, Inc. dated November 12, 2009
99.2	Press Release of MDRNA, Inc. dated November 12, 2009

EX-99.1

Exhibit 99.1

MDRNA, Inc. Announces Third Quarter 2009 Financial Results

Highlights Third Quarter and Recent Corporate Accomplishments

Bothell, Wash., Nov 12, 2009 - MDRNA, Inc. (Nasdaq: MRNA) today reported financial results for the three- and nine-month periods ended September 30, 2009. Net loss for the third quarter of 2009 was approximately $7.0 million or $0.17 per share, compared to a net loss of approximately $16.1 million or $0.52 per share for the same period of 2008. The net loss for the nine months ended September 30, 2009 was approximately $7.3 million or $0.20 per share, compared to approximately $46.9 million or $1.62 per share for the prior year same nine-month period.

“During the third quarter, we made significant progress in our research and pre-clinical efforts as we continued to advance our oncology programs,” said J. Michael French, President and Chief Executive Officer of MDRNA. “In particular, we are encouraged by the recently reported in vivo data on our proprietary compound MRNA-046 which demonstrated sustained reduction in survivin mRNA and inhibition of tumor growth in rodent models of both liver and bladder cancer. In addition, we are reporting, here and on our conference call, that we have observed significant knockdown of a primate liver gene following a single systemic dose of 0.3 mg/kg. We look forward to continuing our rapid progress in both the oncology and non-human primate programs and leveraging our proprietary RNAi discovery engine to create value through both new and expanded research collaborations.”

FINANCIAL RESULTS

Revenue

Revenue for the three months ended September 30, 2009 was $0.1 million, compared to $0.4 million for the three months ended September 30, 2008. Revenue for the nine months ended September 30, 2009 was $14.5 million, compared to $2.4 million for the nine months ended September 30, 2008. Revenue in 2009 primarily included licensing fees of $7.5 million from Novartis, licensing fees of $5.0 million from Roche, and a milestone payment of $1.0 million from Amylin Pharmaceuticals, Inc. related to the amendment to our 2006 License Agreement. Revenue in 2008 was generated from license and research fees, Nascobal^® product sales and government grants.

Expenses

Research and development (“R&D”) expenses for the current quarter decreased 56%, from $7.6 million to $3.3 million, compared to the prior year third quarter, and decreased 56%, from $27.0 million to $11.8 million in the nine months ended September 30, 2009, compared to the same period last year. The decrease in our R&D expenses in 2009 compared to 2008 is primarily related to the cessation of activities associated with our intranasal drug delivery business and a focus on RNAi drug discovery. Additionally, headcount, facilities and stock compensation costs were lower in 2009 compared to 2008.

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Selling, general and administrative (“SG&A”) expenses for the current quarter were $3.5 million which represents an increase of $1.0 million, or 39%, compared to the prior year third quarter. The increase in SG&A was primarily due to an increase in non-cash stock-based compensation related to the accelerated vesting of stock options for a departing senior executive. Year-to-date SG&A expenses decreased $3.3 million or 30% for the nine months ended September 30, 2009 compared to the same prior year period. The lower expenses in 2009 over 2008 are due to headcount reductions and operating efficiency efforts in the administrative areas.

Restructuring Charges

We recorded a net restructuring charge in the third quarter of $0.1 million, and $0.4 million in the nine months ended September 30, 2009, comprised of additional charges related to a facility we exited in 2008. Total restructuring charges of $8.1 million for the 2008 nine-month period were primarily comprised of employee severance and related costs of approximately $4.0 million and $3.8 million in costs related to closing a facility and impairment of equipment.

Other Income/(Expense)

We recorded a net gain on settlement of liabilities during the nine-month period ended September 30, 2009 of $0.7 million related to our efforts during early 2009 to restructure our outstanding liabilities, including our capital lease obligations with GE capital, severance compensation and other accounts payable. We also recorded expenses of $0.2 million and $2.1 million in the three- and nine-month periods ending September 30, 2009 related to the re-measurement of price-adjustable warrants required to be classified as liabilities beginning January 1, 2009. The liability is re-measured at the end of each accounting period, and increases or decreases with changes in our stock price, and variables in our Black-Scholes-Merton valuation model.

Balance Sheet

As of September 30, 2009 we had cash and cash equivalents of $4.6 million compared to $3.3 million as of December 31, 2008. We are currently pursuing multiple near term business and financing opportunities that, if successful, will strengthen our cash position.

THIRD QUARTER AND RECENT CORPORATE ACCOMPLISHMENTS

Advanced RNAi Oncology Programs:

• Reported positive in vivo data demonstrating effective and sustained knockdown of survivin mRNA, an historically undruggable oncology target, with MRNA-046 (a survivin-specific UsiRNA formulated in our proprietary DiLA² liposomal delivery technology) via systemic delivery in a rodent liver cancer model and via local delivery in a rodent bladder cancer model

• Reported positive in vivo data demonstrating that MRNA-046 resulted in 65% and 90% decreases in tumor burden in rodent models of liver cancer and bladder cancer, respectively, compared to negative controls. In the case of the liver cancer study the tumor burden reduction was similar to Avastin^® (bevacizumab)-treated mice which served as the positive control

Advanced Non-Human Primate Program:

• Initiated a program in non-human primates to evaluate safety and efficacy of our UsiRNA construct and lead formulations

• Developed and validated several in-house in vitro and in vivo surrogate assays to model efficacy, safety and toxicology in non-human primates

• Observed significant knockdown of a primate liver gene following a single systemic dose of 0.3 mg/kg which is a therapeutically relevant dose

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Advanced RNAi Drug Discovery Platform:

• Reported positive in vivo data demonstrating that our proprietary UsiRNA constructs silence mRNA (and thus down-regulate protein) via an RNAi-mediated process

• Reported positive in vitro data demonstrating that UsiRNAs can increase strand-specific activity of the guide strand and decrease strand-specific activity of the passenger strand, thus minimizing off-target activity associates with common siRNA

• Reported positive in vitro data demonstrating that UsiRNAs have decreased cytokine induction including toll-like receptor activity compared to other siRNA constructs used in the field

• Announced our first RNAi-related patent allowance covering an siRNA with therapeutic potential in oncology and other indications

• Presented the above accomplishments at multiple conferences and meetings including IBC Drug Discovery & Development Week, Oligonucleotide Therapeutics: From Concept to Implementation, The International Society for Biological Therapy of Cancer and Discovery on Target’s 3^rd Annual RNAi: For Developing Targeted Therapeutics

Strengthened Management Team and Board of Directors:

• Appointed Peter S. Garcia, MBA, as our Chief Financial Officer

• Appointed June D. Ameen, RN, MBA, as our Vice President of Corporate Development

• Appointed James M. Karis to our Board of Directors

Conference Call and Webcast Information

Management will host a conference call to provide a business update and to review financial results for the quarter ended September 30, 2009. The call is scheduled for Thursday, November 12, 2009, at 4:30 pm Eastern Time (1:30 pm Pacific Time). To participate in the live conference call, U.S. residents should dial 866-543-6405 and international callers should dial 617-213-8897. The participant passcode for the live conference call is 97970805. To access the 24-hour telephone replay, available approximately two hours after the live event, U.S. residents should dial 888-286-8010 and international callers should dial 617-801-6888. The participant passcode for the replay is 36119088.

Alternatively, to access the live audio webcast for this conference call via the Internet, please go to MDRNA’s website at http://www.mdrnainc.com under Investors Event Calendar or click on the following link: http://phx.corporate-ir.net/phoenix.zhtml?c=83674&p=irol-calendar approximately 15 minutes prior to the conference call in order to register and download any necessary software. A replay of the webcast will be available for 30 days following the event.

About MDRNA, Inc.

MDRNA is a biotechnology company focused on the development and commercialization of therapeutic products based on RNA interference (RNAi). Our goal is to improve human health through the development of RNAi-based compounds and drug delivery technologies that together provide superior therapeutic options for patients. Over the past decade, we have developed substantial capabilities in molecular biology, cellular biology, lipid chemistry, peptide chemistry, pharmacology and bioinformatics, which we are applying to a wide range of RNAi technologies and delivery approaches. These capabilities plus the in-licensing of key RNAi-related intellectual property have rapidly enabled us to become a leading RNAi-based therapeutics company with a pre-clinical pipeline in oncology. Through our capabilities, expertise and know-how, we are incorporating multiple RNAi technologies as well as peptide- and lipid-based delivery approaches into a single integrated drug

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discovery platform that will be the engine for our clinical pipeline as well as a versatile platform for establishing broad therapeutic partnerships with biotechnology and pharmaceutical companies. We are also investing in new technologies that we expect to lead to safer and more effective RNAi-based therapeutics while aggressively building upon our broad and extensive intellectual property estate. By combining broad expertise in siRNA science with proven delivery platforms and a strong IP position, MDRNA is well positioned as a leading RNAi-based drug discovery and development company. Additional information about MDRNA, Inc. is available at http://www.mdrnainc.com.

MDRNA Forward-Looking Statements

Statements made in this news release may be forward-looking statements within the meaning of Federal Securities laws that are subject to certain risks and uncertainties and involve factors that may cause actual results to differ materially from those projected or suggested. Factors that could cause actual results to differ materially from those in forward-looking statements include, but are not limited to: (i) the ability of MDRNA to obtain additional funding; (ii) the ability of MDRNA to attract and/or maintain manufacturing, research, development and commercialization partners; (iii) the ability of MDRNA and/or a partner to successfully complete product research and development, including preclinical and clinical studies and commercialization; (iv) the ability of MDRNA and/or a partner to obtain required governmental approvals; and (v) the ability of MDRNA and/or a partner to develop and commercialize products that can compete favorably with those of competitors. Additional factors that could cause actual results to differ materially from those projected or suggested in any forward-looking statements are contained in MDRNA's most recent periodic reports on Form 10-K and Form 10-Q that are filed with the Securities and Exchange Commission. MDRNA assumes no obligation to update and supplement forward-looking statements because of subsequent events.

###

Contacts:

MDRNA, Inc.:

Peter Garcia

Chief Financial Officer

(425) 908-3603

pgarcia@mdrnainc.com

Westwicke Partners (Investors):

Stefan Loren, Ph.D., (443) 213-0507

sloren@westwicke.com

John Woolford, (443) 213-0506

john.woolford@westwicke.com

McKinney|Chicago (Media):

Alan Zachary, (312) 944-6784 x 316 or

(708) 707-6834

azachary@mckinneychicago.com

Financial Tables Follow

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MDRNA, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In Thousands, Except Per Share Data)

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2008			2009			2008			2009
	(Unaudited)
Revenue
License and other revenue	$	100		$	61		$	1,213		$	14,435
Product revenue		243			—			972			70
Government grants		62			3			237			19
Total revenue		405			64			2,422			14,524
Operating expenses:
Cost of product revenue		77			—			2,906			—
Research and development		7,603			3,319			27,022			11,775
Selling, general and administrative		2,502			3,478			11,129			7,836
Restructuring		6,167			118			8,084			429
Total operating expenses		16,349			6,915			49,141			20,040
Loss from operations		(15,944	)		(6,851	)		(46,719	)		(5,516	)
Other income (expense):
Interest income		69			1			497			4
Interest expense		(195	)		—			(697	)		(311	)
Net gain on settlement of liabilities		—			—			—			654
Change in fair value of price adjustable warrants		—			(160	)		—			(2,092	)
Net loss	$	(16,070	)	$	(7,010	)	$	(46,919	)	$	(7,261	)
Basic and diluted net loss per share:
Net loss per common share — basic and diluted	$	(0.52	)	$	(0.17	)	$	(1.62	)	$	(0.20	)
Shares used in computing net loss per share – basic and diluted		31,003			40,710			28,986			36,336

Selected Balance Sheet Data (In Thousands)	December 31, 2008			September 30, 2009
				(Unaudited)
Cash and Cash Equivalents (includes restricted cash of $2,268 and $1,157, respectively)	$	3,352		$	4,588
Accounts Receivable, net		32			49
Property and Equipment, Inventories and Other Assets		9,753			5,339
Total assets		13,137			9,976
Fair Value of Liability for Price Adjustable Warrants		—			10,980
Other Liabilities		16,396			5,633
Total Liabilities		16,396			16,613
Accumulated deficit		(254,085	)		(262,232	)

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EX-99.2

Exhibit 99.2

MDRNA, Inc. Receives NASDAQ Notification

BOTHELL, Wash., Nov 12, 2009 – MDRNA, Inc. (Nasdaq: MRNA) announced today that on November 6, 2009 it received a letter from The NASDAQ Stock Market, Inc. notifying the Company that, for ten consecutive business days, based on the Company’s Market Value of Listed Securities (MVLS), it did not comply with the $50 million minimum MVLS for continued listing on The NASDAQ Global Market set forth in NASDAQ Marketplace Rule 5450(b)(3)(A). The Company has a grace period of 90 calendar days (until February 4, 2010) in order to regain compliance, which can be achieved if the Company’s MVLS closes at $50 million or more for a minimum of ten consecutive business days during this time. MDRNA will continue to be listed on the NASDAQ Global Market during this period.

“We believe we are taking all necessary steps to enhance shareholder value and regain compliance with NASDAQ’s listing requirements,” stated J. Michael French, President and Chief Executive Officer of MDRNA. “Based upon the continued advancement of both our science and oncology programs and our on-going business development efforts, we are confident that we will be able to meet the Nasdaq Global Markets listing requirements within the 90 day grace period.”

About MDRNA, Inc.

MDRNA is a biotechnology company focused on the development and commercialization of therapeutic products based on RNA interference (RNAi). Our goal is to improve human health through the development of RNAi-based compounds and drug delivery technologies that together provide superior therapeutic options for patients. Over the past decade, we have developed substantial capabilities in molecular biology, cellular biology, lipid chemistry, peptide chemistry, pharmacology and bioinformatics, which we are applying to a wide range of RNAi technologies and delivery approaches. These capabilities plus the in-licensing of key RNAi-related intellectual property have rapidly enabled us to become a leading RNAi-based therapeutics company with a pre-clinical pipeline in oncology. Through our capabilities, expertise and know-how, we are incorporating multiple RNAi technologies as well as peptide- and lipid-based delivery approaches into a single integrated drug discovery platform that will be the engine for our clinical pipeline as well as a versatile platform for establishing broad therapeutic partnerships with biotechnology and pharmaceutical companies. We are also investing in new technologies that we expect to lead to safer and more effective RNAi-based therapeutics while aggressively building upon our broad and extensive intellectual property estate. By combining broad expertise in siRNA science with proven delivery platforms and a strong IP position, MDRNA is well positioned as a leading RNAi-based drug discovery and development company. Additional information about MDRNA, Inc. is available at http://www.mdrnainc.com.

MDRNA Forward-Looking Statements

Statements made in this news release may be forward-looking statements within the meaning of Federal Securities laws that are subject to certain risks and uncertainties and involve factors that may cause actual results to differ materially from those projected or suggested. Factors that could cause actual results to differ materially from those in forward-looking statements include, but are not limited to: (i) the ability of MDRNA to obtain additional funding; (ii) the ability of MDRNA to attract and/or maintain manufacturing, research, development and commercialization partners; (iii) the ability of MDRNA and/or a partner to successfully complete product research and development, including preclinical and clinical studies and commercialization; (iv) the ability of MDRNA and/or a partner to obtain required governmental approvals; and (v) the ability of MDRNA and/or a partner to develop and commercialize products that can compete favorably with those of competitors. Additional factors that could cause actual results to differ materially from those projected or suggested in any forward-looking statements are contained in MDRNA’s most recent periodic reports on Form 10-K and Form 10-Q that are filed with the Securities and Exchange Commission. MDRNA assumes no obligation to update and supplement forward-looking statements because of subsequent events.

###

Contacts:

MDRNA, Inc.:

Peter Garcia

Chief Financial Officer

(425) 908-3603

pgarcia@mdrnainc.com

Westwicke Partners (Investors):

Stefan Loren, Ph.D., (443) 213-0507

sloren@westwicke.com

John Woolford, (443) 213-0506

john.woolford@westwicke.com

McKinney|Chicago (Media):

Alan Zachary, (312) 944-6784 x 316 or

(708) 707-6834

azachary@mckinneychicago.com