Mera Pharmaceuticals turns
over two executive positionsCo-founder Mark Huntley and
President Harry Dougherty left the firmBy Dave Segal
dsegal@starbulletin.comAquasearch Inc. co-founder Mark Huntley, who agreed to give up his top executive posts to become chief technical officer after the company entered Chapter 11 bankruptcy in October 2001, is no longer with the new company and is disputing his departure.
Mera Pharmaceuticals Inc., which produces the nutritional product AstaFactor from microalgae, changed its name from Aquasearch in July prior to emerging from bankruptcy. The company said in a filing with the Securities and Exchange Commission that Huntley has asserted a claim that Mera involuntarily terminated his employment in December. Mera said in the same filing that Huntley resigned and that the two sides are in discussions to resolve the matter.
Huntley was chairman, president and chief executive officer of Aquasearch when creditors sued to force the company into bankruptcy.
Mera, which reported its loss in its fiscal 2003 first quarter widened to $628,096, also said President Harry Dougherty resigned. The company said Dougherty's resignation "was not motivated by disagreements on any matter relating to operations, policies or practices."
Richard Propper, who is based in the company's administrative office in Solana Beach, Calif., remains the CEO. The company also has a plant in Kona and has contracted with Hainan Sunshine Ocean Bioengineering Ltd. to have a $20 million microalgae plant built in China. The plant is fully owned by Hainan but is being built to Mera's specifications. Mera has a licensing agreement that permits its partner to produce and distribute astaxanthin, a pigment found in many species of fish and seafood, to the worldwide market. Mera will get royalties from the sales.
Mera, which has never made a profit, has lost nearly $23.8 million since its 1988 inception, including more than $1.5 million since emerging from bankruptcy Sept. 16, 2002. In its fiscal first quarter, which ended Jan. 31, Mera had a loss of 2 cents a share, compared with a loss of $473,260, or 4 cents a share, a year earlier.
Mera's stock, which is traded on the Over the Counter Bulletin Board, fell .002 cents today to 3.5 cents.
The company said its losses since emerging from bankruptcy have resulted primarily from costs incurred in research and development and from general and administrative expenses. Mera said it expects to incur operating losses for at least the next year.
Mera, which had cash and cash equivalents of $202,021 as of Jan. 31, said its deficit of $1.5 million since emerging from bankruptcy currently exceeds its current assets by $542,210. However, the company said it anticipates that its future revenue will be sufficient to cover operating expenses and that it will continue to seek capital investment. Mera's revenues fell 29.3 percent in the quarter to $182,182 from $257,818 a year earlier. Of its revenues, $123,769 came from sales of AstaFactor, with $28,739 coming from contract services and $29,674 from royalties.
The company said that during the quarter it raised approximately $2.6 million from the sale of common and preferred stock and nearly $186,000 from the issuance of debt securities in private placement transactions. Mera also said it holds a subscription agreement that would result in a $500,000, and a separate investment of $285,000 this year.
