Affymax, Inc. (NASDAQ:AFFY) Faces Last Day on the Nasdaq
Today may very well be the last day of trading on the Nasdaq for Affymax, Inc. (NASDAQ:AFFY). The company filed an 8-K concerning the determination letter from Nasdaq last Friday.
The shareholders of AFFY have been hit hard. Year-to-date, the stock is down about 90%. Before news about the determination letter hit, AFFY had two positive sessions, but the price has dropped 18% and 8% on Monday and Tuesday, respectively.
The 8-K filing showed that AFFY had no intention to appeal the delisting determination, and if that is indeed the case, AFFY‘s common stock will be suspended tomorrow at the open. However, Affymax stated its “intention that its securities would be eligible for quotation on the OTC Bulletin Board.”
At this point the future of the troubled biophamaceutical company doesn’t look rosy. AFFY‘s only product, OMONTYS, was approved by the FDA in March 2012. In February this year, the company and its collaboration partner, Takeda Pharmaceutical Company Limited, announced a voluntary recall of the drug, due to safety concerns.
Currently, AFFY is in the process of restructuring operations. Certain aspects of this process included letting go virtually the whole workforce of the company, and terminating the employment of all executive officers.
Additionally, in April AFFY and Takeda amended their agreements, and as a result Takeda now holds a worldwide, exclusive royalty-bearing license under AFFY‘s and joint patents to develop, manufacture and commercialize OMONTYS.
The investigation of OMONTYS is ongoing, and the decision about whether the drug will be reintroduced lies with Takeda. A potential reintroduction could mean royalties and milestone payments for AFFY. That, however, would at best be $180 million and it will take time, and at worst it may just never happen.
With all the uncertainty around AFFY‘s near and long-term future current shareholders are in a tough spot. So far the company hasn’t completely ruled out bankruptcy, so an investment would entail significant risk.
