April 14, 2016
By Mark Terry, BioSpace.com Breaking News Staff
Raleigh, N.C.-based NephroGenex (NRX) disclosed in a U.S. Securities and Exchange Commission filing yesterday that it had terminated Pierre Legault as chief executive officer and president. In addition, it let go Jaikrishna Patel, the company’s chief scientific officer, as well.
John Hamill, the company’s chief financial officer, will add on the duties of chief executive officer. Hamill has been the chief financial officer since January 2014. Prior to that he was co-president and chief financial officer of Savient Pharmaceuticals (SVNT).
On April 11, the company announced that it had been put on notice by The Nasdaq Stock Market that it was headed toward being delisted. There are a variety of requirements to stay listed, but one is that you have a share price of at least $1. NephroGenex’s share price dropped below that threshold for 30 consecutive days. It has a 180-day grace period, which ends on Oct. 4, 2016, to comply.
On April 8, analysts with H.C. Wainwright, in a note to investors, gave NephroGenex a “neutral” rating, which had previously been a “buy” rating. The consensus target price was $9, which seems wildly optimistic given its current stock price. The company’s current share price is $0.39. On June 22, 2015, shares traded for $8.70, but it’s been pretty much downhill since.
On Feb. 24, the company announced that its board had decided to pause its clinical program for oral Pyridorin for the treatment of diabetic nephropathy. It also planned to restructure its operations and put forth a strategic transaction. The decision, the company stated, was made “in light of the remaining trial costs, the Company’s cash balance and the condition of the capital markets.”
One of the strategic transactions it was considering was a reverse merger, and had hired MTS Health Partners to help in exploring alternatives. A reverse merger is when a public company is bought by a private company, and bypasses the process of going public. No further mention of a reverse merger has been made.
The company also announced that as of Feb. 23, 2016, it had paid off about $6.3 million in loans. After that payment, it indicated it had about $11.5 million in cash, cash equivalents and short-term investments.
NephroGenex focuses on therapies for kidney disease. Its Pyridorin (pyhridoxamine dihydrochloride) is being evaluated in a Phase III study to treat diabetic nephropathy. The company is also evaluating intravenous formulations of Pyridorin for specific types of acute kidney injury.
One thing that seems puzzling about the downhill slide is that on Jan. 21, the company announced that the independent Data and Safety Monitoring Board (DSMB) for the Phase III trial of Pyridorin had completed its second, pre-planned six-month safety review and given a unanimous recommendation to continue without modifications. It would seem that the company is cash-strapped and may be unable to complete the trial.
“We are encouraged by the recommendation of the independent DSMB review,” said Legault in a statement. “We are excited by the progress of our Phase III trial, and the potential for Pyridorin to be an important therapy for diabetic nephropathy, a progressive disease for which there are limited treatment options.”