Molecular Insight Pharma, Xconomy’s Neighbor, Faces Uncertain Future in Chapter 11
Molecular Insight Pharmaceuticals, which shares a floor with Xconomy in the building at 101 Rogers Street, is in financial trouble.
The Cambridge, MA-based company, a developer of molecular medicines for cancer founded in 1997, has been in Chapter 11 since December 9. The company, which defaulted last year on a $150 million bond, has been unable to come to new terms with its bondholders. Since December 2009, the firm has more than halved its staff from 70 employees to about 30 workers today, said interim chief financial officer Mark Attarian.
Molecular Insight had total debts of $198.8 million and assets of $36.5 million, according to federal bankruptcy records. The lion’s share of the firm’s debt stems from the bonds it issued in November 2007 and accrued interest from them.
Nevertheless, Molecular Insight is trying to pull through this rough patch. There are at least two competing proposals to replenish the company’s coffers, including one from San Francisco-based private equity firm Savitr Capital and another from an informal group of Molecular Insight’s bondholders, according to court documents. Each of those parties is jockeying for a controlling stake the company in return for their money.
Still, Molecular Insight—which has four oncology products and one cardiac imaging drug at various stages of human clinical development—faces an uncertain future.
“We just don’t know who the new owner is going to be… [and] where will those new owners want to take the company,” Attarian said.
Attarian, a partner at the executive consulting firm Tatum, was part of a major leadership shakeup at Molecular Insight that the company announced at the time of its bankruptcy filing in December. That shakeup included the resignations of former CEO Daniel Peters and former CFO Charles Abdalian. Harry Stylli, a long-time board member, took the job of president and chief of restructuring. And Attarian was named to his interim post.
Also, the company said its common stock was de-listed from the NASDAQ in December and moved to the OTC Marketplace. The stock was trading around … Next Page »