Voxel Attributes Stock Price Plunge to Investment Bank Glitches


The price of Voxel stock dropped sharply last week, prompting the fledgling biotechnology company to issue a statement Monday linking the decline to problems facing its New York-based investment banker, A.R. Baron & Co.

In early September, the National Assn. of Securities Dealers, which regulates the Nasdaq market system, suspended Baron from making a market in Voxel and other stocks for a few days for failing to meet capital requirements, said Voxel's chief executive, Dr. Allan Wolfe. Late last week, another capital issue prompted Baron to halt its market-making in Voxel once again, Wolfe said.

Baron officials wouldn't comment, and Nasdaq officials couldn't be reached for comment.

Voxel shares closed Friday at $3.625, down $2.50, or 41%, from $6.125 on Monday, Oct. 9. After the company's statement Monday, the shares recovered somewhat to close at $4.50, up 87.5 cents.

The Laguna Hills company is planning next year to start marketing a system for making holographic X-rays of the human body.

Meanwhile, an official at Duke & Co., a New York investment banking and brokerage firm, which aims to acquire Baron's assets, said it started making a market in Voxel stock last week.

Baron underwrote Voxel's initial public offering last November. The offering consisted of 1.9 million units, each of which included a share of stock and a warrant to purchase a share at $6. Voxel had hoped investors would exercise the warrants this year, thereby enabling it to raise more capital it needs to build up inventories and market its X-ray system next year, Wolfe said.

Voxel has only about one-fifth of the $10 million it needs to market the system, he said.

Consequently, he's seeking other sources of capital, talking both with other investment bankers and with corporations that might license Voxel technology.

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