Turing Pharma chief-led group acquires majority of KaloBios Pharmaceuticals
19 November 2015
A group led by Martin Shkreli, who runs Turing Pharmaceuticals, a private company, has acquired a majority of the shares of KaloBios Pharmaceuticals, a publicly traded biotechnology company that was about to close down.
KaloBios had on Friday said it would wind down its operations after having suffered various setbacks in drugs development.
However, in a statement yesterday, KaloBios said that a group led by Shkreli had acquired over half of its outstanding shares and that the company was in discussions with Shkreli about the possibility of continuing operations.
Shkreli was earlier in the news for an abrupt fifty fold increase in price of an old infectious disease drug.
Shares of KaloBios surged over 800 per cent after hours yesterday, to more than $19, after the stock purchases were reported in a filing with the Securities and Exchange Commission.
According to commentators, it was possible that Shkreli intended to merge the two companies to take Turing public, but it also seemed possible that Shkreli could sell his KaloBios shares and realise a tidy profit.
According to the regulatory filing, Shkreli and his group had acquired 1.2 million shares on Monday and Tuesday alone, at an average price of about $1.35 per share.
"We have received communications from Mr Shkreli informing us of his group's ownership position, and a proposal to continue the company's operations," said Ronald Martell, executive chairman of KaloBios. "Our board of directors is prepared to entertain any constructive proposal, which we will act upon promptly. Addressing short-term cash needs is our first priority, and we continue to be open to further dialogue," he concluded.
KaloBios Pharmaceuticals is engaged in the development of innovative therapies to treat diseases of high unmet medical need, with a focus on oncology. KaloBios has focused on advancing the following immuno-oncology and oncology programmes in clinical development.
KB004 is a non-fucosylated mAb targeting EphA3 with the potential to treat hematologic malignancies and solid tumors. KB004 is designed to kill tumor cells through multiple mechanisms, including antibody-directed cellular cytotoxicity (ADCC), direct apoptosis or disruption of the tumor stem cell environment and the vasculature that feeds it.
KB003, or lenzilumab, is an anti-GM-CSF mAb that KaloBios is evaluating in oncology indications where GM-CSF may play a key role, such as chronic myelomonocytic leukemia (CMML). The IND for KB003 in CMML, an orphan oncology indication, has been cleared by the FDA.