KaloBios (KBIO) Pharma Stock Rockets +65 Percent after CEO Shkreli Stops Lending Shares
Shares of KaloBios Pharmaceutical Inc. (KBIO) were trading up +17.17 or +64.48 percent to $43.80 per share in Friday’s premarket after a Twitter comment by KaloBios Chief Executive, Martin Shkreli, in which he stated that he would not lend any more of his KaloBios stock for people looking to sell it short. KaloBios stock was up more than +80 percent when the news broke earlier this morning. KaloBios stock closed at $26.63, up +8.23 or +44.73 percent in Wednesday’s regular trading session.
South San Francisco, California based KaloBios Pharmaceutical Inc. is a biopharmaceutical company focused primarily on the development of monoclonal antibody therapeutics for the treatment of a variety of diseases.
The incredible short squeeze in the stock began on November 6th, when the company announced it would wind down its operations after unsuccessfully finding a strategic alternative to staying in business. The company announced it was discontinuing its two development programs for KBOO4 and KBOO3 which were in Phase 2 and Phase 1 studies respectively. The development sent the stock down to close at $0.44 per share on November 16th after announcing that the cash crunch the company was facing was so severe it did not have the resources for filing a 10-Q form with the Securities and Exchange Commission.
On November 20th, Martin Shkreli was named the company’s Chief Executive Officer after his investment group acquired 70 percent of KaloBios’ outstanding shares. Shkreli committed a $3 million equity investment with an equity financing facility of $10 million. The stock then soared, first going from $2.07 to $19.01 per share and subsequently running up to $45.82 in the few days following the announcement. KaloBios shares then got pummeled, trading down to $18.40 before resuming its extraordinary rally.
Yesterday morning, Chief Executive Shkreli said on Twitter that, “I spoke with my counsel & advisers and decided to stop lending my $KBIO shares out until I better understand the advantages of doing so.” In a subsequent tweet, Shkreli said that, “I apologize for any inconvenience this may create in lending markets and I will probably resume lending at some point. Happy Thanksgiving!”
Shkreli, who is the Chief Executive of Turing Pharmaceuticals, was recently in the news after his firm raised the price of Daraprim, a decades old drug for the treatment of toxoplasmosis which the company bought, from $13.50 per pill to $750 per pill.
Short interest in KBIO stock went from 5.6 percent on November 16th to 49 percent, which could send the stock even higher if the shorts have their stock called. The initial news this morning sent the stock up more than +80 percent, nevertheless, KaloBios shares have retreated significantly and are up +11.36 or +42.66 percent at $37.99 per share as of this writing.
Other News About KBIO
KaloBios Attempts To Consolidate After Four Volatile Sessions
Today’s action will be volatile in the stock after this morning’s news.
Where Is KaloBios Pharmaceuticals' Stock Heading Next?
Forbes article which evaluates where the stock could be headed after last week’s move.
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