KaloBios Pharmaceuticals Inc. (NASDAQ: KBIO) saw its shares absolutely skyrocket after the markets closed on Wednesday. Turing Pharmaceuticals CEO Martin Shkreli took a major stake in this small biopharma company over the course of this week.
The company disclosed that over half of its stock was owned by Shkreli Wednesday afternoon.
Shkreli is known for recently buying the rights to Daraprim, a drug used in AIDS treatment for toxoplasmosis or blood parasites. After this purchase, he hiked the drug price by about 5,500%, which ultimately caused a great upheaval in the health care sector. Many began to question how to properly value drugs and treatments.
As for KaloBios, it appears that Shkreli wants to keep this business in operation. There are reports that Turing’s CEO is in talks with KaloBios about continuing operations considering its development of cancer drugs. According to the release, “the company is in discussions with Mr. Shkreli regarding possible direction for the company to continue in operation.”
Ronald Martell, executive chairman of KaloBios, commented:
We have received communications from Mr. Shkreli informing us of his group’s ownership position, and a proposal to continue the company’s operations. 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.
KaloBios had previously announced that it would undertake a wind-down of the business.
As of Wednesday’s close, the company has vastly underperformed the market, with the stock down 85% year to date. However, over the past 52 weeks, the stock is down roughly 87%.
Shares of KaloBios closed Wednesday at $2.17, with a consensus analyst price target of $5.00 and a 52-week trading range of $0.44 to $16.00. In early trading on Thursday, shares were up by almost 600% at $14.38.