Last summer, Nabi Biopharmaceuticals' ($NABI) stock price went into a tailspin after its nicotine addiction vaccine flunked a late-stage trial, triggering a move to go in search of an alternative business strategy for the Rockville, MD-based biotech. Today, that new strategy took shape in the form of a merger with Australia's flu drug developer Biota, which is now moving its headquarters to the U.S.
The newly merged company will keep the Biota name and management and trade on Nasdaq, a move that was applauded by Australian analysts who feel that the investment community Down Under isn't strong enough to sustain a biotech company like this. Biota shareholders will retain a 74% interest in the combined operation.
Biota is credited with the development of Relenza and Inavir and has a $231 million contract with BARDA to develop a new flu antiviral. But investors failed to see a big upside in the merger news today, driving down the share price about 9% this morning and forcing company executives to defend the merger maneuver.
"The reality for shareholders is we think this deal is value enhancing," Biota Chairman Jim Fox said as he discussed the deal, according to the Dow Jones report.
- get the press release
- here's the Dow Jones story