SOUTH SAN FRANCISCO, Calif., Nov. 13, 2015 /PRNewswire/ -- KaloBios Pharmaceuticals, Inc. (Nasdaq: KBIO) today announced that it will wind down its operations and that it has engaged the Brenner Group to lead those efforts.
"Recent discussions around a number of possible strategic transactions have ended, and as a result, the company believes it is highly unlikely that continuing to explore strategic alternatives could generate a viable transaction within the time frame allowed by our limited cash resources," said Herb Cross, Chief Financial Officer and Interim Chief Executive Officer.
The company will discontinue its two current development programs, KB004, being studied in Phase 2 for certain hematologic malignancies, and lenzilumab, or KB003, scheduled to initiate Phase 1 development later this year in chronic myelomonocytic leukemia (CMML). KaloBios has engaged the restructuring firm of The Brenner Group to assist in the wind down of operations and liquidation of the company's assets. The company recently announced a reduction in operations and headcount affecting approximately 60% of the company's 28 employees. As a part of its wind down and handing over management of the wind down to The Brenner Group, the company expects to phase out the remaining employees over the next thirty to sixty days. As a result of these developments, the company will not be able to file its Form 10-Q for the third quarter, primarily due to resource constraints.
As a part of its restructuring and winding down, the company has repaid in full its outstanding secured loan obligation to MidCap Financial, secured lender to the company, in the approximate amount of $6.6 million.
For more information on KaloBios Pharmaceuticals, please visit our web site at http://www.kalobios.com.
This release contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, and statements regarding the company's clinical development of KB004 and KB003. Forward-looking statements reflect management's current knowledge, assumptions, judgment and expectations regarding future performance or events. Although management believes that the expectations reflected in such statements are reasonable, they give no assurance that such expectations will prove to be correct and you should be aware that actual results could differ materially from those contained in the forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties including, but not limited to, the company's limited cash reserves and its ability to conduct business or obtain additional capital on acceptable terms, or at all, including the additional capital which would be necessary to complete the clinical trials that the company has initiated or plans to initiate; the potential timing and outcomes of clinical studies of KB004 and KB003 undertaken now or in the future, given the winding down of operations; the ability of the company to timely source adequate supply of its development products from third party manufacturers on whom the company depends; the potential, if any, for future development of our product candidates; the company's ability to successfully progress, partner or complete further development of its programs; the uncertainties inherent in clinical testing; the timing, cost and uncertainty of obtaining regulatory approvals; the company's ability to protect the company's intellectual property; competition; changes in the regulatory landscape or the imposition of regulations that affect the company's products; and other factors listed under "Risk Factors" in the company's most recent quarterly report on Form 10-Q filed with the Securities and Exchange Commission on August 10, 2015, the Annual Report on Form 10-K filed on March 16, 2015, and the company's other filings with the Securities and Exchange Commission.
All forward-looking statements are expressly qualified in their entirety by this cautionary notice. You are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date of this release. The company has no obligation, and expressly disclaims any obligation to update, revise or correct any of the forward-looking statements, whether as a result of new information, future events or otherwise.
For more information, visit http://www.kalobios.com.
Chief Financial Officer
KaloBios Pharmaceuticals, Inc.
Joan E. Kureczka
Tel: (415) 821-2413
Mobile: (415) 690-0210
SOURCE KaloBios Pharmaceuticals, Inc.