KaloBios Skyrockets After Martin Shkreli Takes a Majority Stake

By Chris Lange Updated Jan 13, 5:00PM EST · Published Nov 19, 10:15AM EST

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KaloBios Skyrockets After Martin Shkreli Takes a Majority Stake — © Thinkstock

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.

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About the Author Chris Lange →

Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics.

Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications.

A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.