KaloBios Surge Continues As Firm Names Martin Shkreli As New CEO

Written by Mani

KaloBios Pharmaceuticals announced late Thursday that former hedge fund manager Martin Shkreli has become its chief executive officer and chairman after he led a group of investors to buy 70% of the drug developer’s outstanding shares, or as DealBreaker so eloquently put it  ” Desperate Pharmaceutical Company Hits Rock Bottom, Names Martin Shkreli CEO“-  The South San Francisco-based company said Shkreli will work with KalioBios’ senior management team to ensure its continued operations.

Chart via S&P Capital IQ

Shkreli’s majority stake in KaloBios

As outlined by Martin Shkreli a regulatory filing with the Securities and Exchange Commission revealed that Shkreli acquired over 1.21 million shares of KaloBios Pharmaceuticals worth over $5.16 million on Nov. 16 and 17.

Shkreli, a Turing Pharmaceuticals executive, acquired 500,169 shares of KaloBios Pharmaceuticals for 61 cents per share and an additional 97,269 shares for $1.43 per share on Nov. 16. The following day, he acquired 606,677 shares for $1.93 per share and an additional 7,000 shares for $2.43 per share.

Following the buildup of Shkreli’s stake, the stock price of KaloBios Pharmaceuticals rocketed by over 700% from $1.97 per share to as much as $16 per share during extended trading on Wednesday. On Thursday, shares of the cancer drug developer closed at $10.40, up 402.42%. Thanks to the upsurge, Shkreli’s investment in KaloBios surged by over $130 million. At the time of writing, KaloBios’ shares had surged by another 75% to $18.25 during Friday’s trading hours. Shares are up another 37% to $25 a share at 10:30 AM EST in Monday’s trading session.

KaloBios names Shkreli as CEO

In its statement, KaloBios said the investor group led by Shkreli, has acquired 70% of its outstanding shares. The pharmaceutical company also received a commitment from Shkreli and other investors for an equity investment of at least $3  million. The drug developer said Shkreli and the group of investors have committed to a $10 million equity financing facility, subject to applicable shareholder approval. KalioBios further announced that following the latest developments, David Moradi,Tony Chase and Marek Biestek have been elected to the board of directors, while the former directors have resigned effective immediately.