You saw this coming if you were paying attention: After the NASDAQ delisted the stock of SF-based KaloBios and halted trading of it last week in the wake of CEO Martin Shkreli's arrest, the company has now filed for Chapter 11 bankruptcy, as the New York Times reports. The reorganization filing came on Tuesday, the same day that the company announced that it would appeal the NASDAQ's delisting ruling, in February, as the Wall Street Journal noted.
The stock price was halted at $23.59 on Christmas Eve, and in its letter to KaloBios about the delisting, the NASDAQ cited Shkreli's arrest and firing, and charges against one other company official.
Shkreli had only served as the company's CEO for about three weeks, having been given the title on November 20 after he and a consortium of investors purchased a 70-percent stake in the company.
In the bankruptcy filing, KaloBios listed assets of $8.4 million and liabilities of $1.9 million. According to an earlier report by the SF Business Times, the company was "on the brink of bankruptcy" when Shkreli bought it.
As of Monday, as the NYT notes, two directors, Tom Fernandez and Marek Biestekhad, also resigned.
Shkreli was arrested on December 17 in what many people saw as karmic retribution for price-hikes he made on two life-saving medications. The second of these appeared to be a scheme to acquire a federal voucher for the development of another drug altogether, which KaloBios likely planned to sell to another drug company for hundreds of millions in profit. Shkreli's arrest, however, was in connection to a Ponzi-like scheme dating back several years in which the feds allege that Shkreli was using money from another pharmaceutical company to pay back investors he'd defrauded while running MSMB Capital, a hedge fund he founded in 2009.
Previously: Taint Of Martin Shkreli Threatens Bay Area Biotech Company