KaloBios Pharma (KBIOQ) Affirms Martin Shkreli Exit of Stake in Company

August 29, 2016 9:28 AM EDT
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KaloBios Pharmaceuticals, Inc. (OTC: KBIO) announced the sale by Martin Shkreli of his remaining shares of KaloBios common stock, fully eliminating his association with the company. KaloBios also outlined its priority goals as it continues to transform the company.

In private transactions, Mr. Shkreli sold his entire stake in KaloBios directly to other investors. Mr. Shkreli has zero ownership of the capital stock of, or ongoing financial interest in, the company. In addition, under the terms of the governance agreement announced July 7, Mr. Shkreli continues to be restricted from certain further actions concerning the company for a period of time.

“This transaction enhances our flexibility to execute the company’s strategy by removing an impediment to progress,” said Cameron Durrant, MD, KaloBios chairman and CEO. “The new KaloBios strategy is to leverage available U.S. regulatory incentives as a framework to swiftly and cost-effectively advance and strengthen our portfolio for neglected and rare diseases, with an interest in pediatric conditions.”

KaloBios has set out key near-term goals in executing this strategy:

  • Benznidazole – expect to have U.S. Food and Drug Administration (FDA) Pre-Investigational New Drug (IND) application meeting within the next six months to confirm the regulatory pathway for benznidazole in the treatment of Chagas disease, a neglected tropical disease.
  • Lenzilumab – continue enrolling patients in the company’s ongoing Phase 1 study of lenzilumab for Chronic Myelomonocytic Leukemia (CMML), with the expectation to use the data to help inform a possible study in Juvenile Myelomonocytic Leukemia (JMML), a rare pediatric condition.
  • Corporate – regain compliance with periodic reporting requirements of the Securities and Exchange Commission, and seek relisting on a national stock exchange.

Dr. Durrant stated, “We have come a long way quickly – overcoming obstacles, establishing the framework for success and leveraging a hard-driving mindset to advance our pipeline. Our differentiated strategy is gaining traction and we will continue to execute our plan through transformational models, such as responsible pricing and innovative internal and external approaches.”

KaloBios emerged from Chapter 11 bankruptcy June 30 with $14 million in equity financing. The company acquired the rights from Savant Neglected Diseases LLC to develop benznidazole for the treatment of Chagas disease and has initiated a Phase 1 study of its monoclonal antibody candidate lenzilumab for the treatment of CMML.

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