Aftershocks Keep Coming After Former Pharma CEO’s Arrest
(Reuters) – KaloBios Pharmaceuticals said on Wednesday that it had been notified by Nasdaq that its stock would be delisted using the exchange operator’s “discretionary” authority.
The Nasdaq cited the criminal indictment and arrest of the company’s former CEO Martin Shkreli; the arrest and indictment of Evan Greebel, KaloBios’ former outside counsel, and a civil complaint by the U.S. SEC against Shkreli and Greebel in its notification.
The drugmaker said on Monday that it had fired the controversial Shkreli on Dec. 17, the day he was arrested on charges of a securities fraud.
Shares of the company – which has not determined whether it will appeal the decision – have not traded since Thursday.
The deadline to request an appeal is Dec. 28, and if KaloBios decides to accept the ruling, the stock will be suspended from trading on Dec. 30.
Shkreli has been accused of running a Ponzi-like scheme at his former hedge fund MSMB Capital Management and Retrophin, a company he headed before he took the helm of Turing Pharmaceuticals.
Shkreli stepped down as Turing CEO on Dec. 18.
KaloBios had named Shkreli as its CEO on Nov. 20, after Shkreli and a consortium of investors bought about 70% of the company’s shares.
Nasdaq also said KaloBios (KBIO) had failed to file its quarterly report for the period ended Sept. 30, constituting an additional basis for delisting.