October 12, 2015
By Mark Terry, BioSpace.com Breaking News Staff
Quebec City, Canada-based AEterna Zentaris announced today that the company’s Dennis Turpin, senior vice president and chief financial officer, would be stepping down. In addition, Aeterna Zentaris is closing its Quebec City office at the end of the year and consolidating functions at its Charleston, S.C. office.
The company focuses on developing and marketing treatments in oncology, endocrinology and women’s health. It markets EstroGel, a non-patch transdermal estrogen therapy to reduce moderate to severe hot flashes, and to treat vaginal conditions related to menopause. It also has Macrilen for adult growth hormone deficiency in Phase III trial, Zoptarelin Doxorubicin for endometrial cancer in Phase III trial, as well as in Phase II for castration and taxane-resistant prostate cancer. It also is studying perifosine in colorectal cancer and multiple myeloma in Phase III trials.
In the company’s second quarter financial report on Aug. 13, 2015, David Dodd, chairman, president and chief executive officer, said, “During the first quarter of this year, we made the decision to raise a significant amount of capital to see us through the next 18 months of the implementation of our strategy. As a result, we are in a strong financial position with cash and cash equivalents of approximately $45.5 million as of June 30. However, the pressure being exerted on our stock price since our public offering does not reflect this strong cash position, our recent achievements and overall corporate value.”
Company traded for $1.29 on Nov. 5, 2014, dropped to $0.75 on Dec. 2, 2014, rose slightly to $0.84 on Mar. 4, 2015, and slid to $0.30 on May 20. It’s been on a hard downward trend ever since, hitting $0.05 per share on Sept. 17, 2015. It is currently trading for $0.07 per share.
Analysts project that in the short-term share price could hit $1.5, which has been cited by two analysts. That’s based on an average, however, with one citing $2 per share and the other citing $1 per share. Either one would be hugely significant given the current price.
The company indicates it will start a search for a chief financial officer, as well as new finance and accounting personnel for its Charleston, S.C. office. Keith Santorelli, vice president of finance, will replace Turpin as chief accounting officer, and handle chief financial officer duties until a permament replacement can be found.
“After a comprehensive review, the Company’s Board reached the decision to take these actions, including the closure of our Quebec City office by the end of December, making all associates based there redundant,” said Dodd in a statement. “We will transfer many of the functions now performed in our Quebec City office to other personnel and we will strengthen our financial team with the addition of new finance and accounting personnel in our Charleston, South Carolina office.”
On Sept. 24, the company announced that a class action lawsuit filed on behalf of shareholders had been dismissed. The lawsuit alleged violations of the federal securities laws. According to The Rosen Law Firm “The Company misstated information about its New Drug Application (NDA) with the FDA. On October 18, 2012, the Company announced the Phase III clinical trial results of its drug Macrilen, stating that the results ‘confirm [Macrilen’s] potential as possibly the first approved oral diagnostic test for [adult growth hormone deficiency.’”
The lawsuit was dismissed with “leave to amend.” They plaintiffs have until Wednesday, Oct. 14 to amend their complaint or appeal the Court’s decision.
“We believe the plaintiffs will be unable to correct the deficiencies in their case by amending their complaint, if they decide to do so, because we are confident that their allegations are without merit,” said Dodd in a statement. “Likewise, we believe that an appeal of the Court’s decision would be unsuccessful because the Court’s analysis of the law and the complaint is sound.”
