WEDNESDAY, JAN. 22, 2020 | IN THIS ISSUE

• KemPharm moves to Nasdaq Capital Market
• In the CBJ: 2019 was another good year for dealmaking
• Rural Mainstreet Index begins 2020 on stronger footing
• Don't miss your chance to register for Book of Lists unveiling
 • IowaBio opens nominations for Biotech Leader Award
KemPharm moves to Nasdaq Capital Market
KemPharm, the Coralville-based specialty pharmaceutical company, is striving to maintain its Nasdaq listing as the company’s stock has slumped below $1 per share.

Shares of KemPharm were trading Tuesday at 43 cents per share, down from a 52-week high of $2.85. The stock listing for KemPharm was moved effective Tuesday to the Nasdaq Capital Market from the Nasdaq Global Market.

The Nasdaq Capital Market is a trading tier for smaller companies that typically are raising capital. KemPharm was notified last May that it was not in compliance with the listing requirements of the Nasdaq Global Market, which require maintaining a minimum $50 million market value of listed securities (MVLS).

In a news release, KemPharm said it requested the listing transfer and has been granted an extension until May 13, 2020, to regain compliance with the Nasdaq Capital Market’s MVLS requirement of $35 million. Regaining compliance is contingent on achieving milestones included in a plan of compliance KemPharm submitted to a Nasdaq Listings Qualifications Panel.

KemPharm said it must also regain compliance for other continued listing requirements. On Sept. 27, it received notice from Nasdaq that it was not in compliance with the continued listing requirement to maintain a minimum bid price of $1. The initial compliance period for that continued listing requirement ends on March 25. If the company’s bid price is not above $1 for at least 10 consecutive trading days during the compliance period, it could be grounds for delisting.

KemPharm also was notified Dec. 19 that it was not in compliance with a continued listing requirement of the Nasdaq Global Market to maintain a minimum value of publicly held shares (MVPHS) of $15 million. By transferring its listing to the Nasdaq Capital Market, KemPharm will regain its compliance with that listing requirement by reaching a MVPHS of $1 million for 10 consecutive trading days. However, if KemPharm fails to satisfy the MVPHS continued listing requirement prior to the June 16 end of the compliance period, it could provide additional grounds for delisting by Nasdaq.
In the CBJ: 2019 was another good year for dealmaking
The Corridor’s M&A market closed out the decade with another big year, despite economic jitters over trade and the ag economy.

The CBJ last year reported on 46 business mergers and acquisitions in the seven-county region known as the Creative Corridor. That’s down from 2018’s record mark of 53 deals, but still well above the 29 reported in 2017, and 21 in both 2016 and 2015, the first year the CBJ began tracking regional M&A.

Last year’s number includes United Technologies Corp.’s proposed $135 billion merger with defense contractor Raytheon, which was one of the biggest global deals announced in 2019, according to Fortune magazine. UTC is the parent company of Collins Aerospace, which has two of its six divisions based in Cedar Rapids.

It should be noted that these numbers include only companies or deals that the CBJ reported on in some capacity. There were many more deals in Eastern and Central Iowa – covered by our colleagues at the Des Moines Business Record, for example – and likely many more in our region that flew under our radar.

The Corridor’s M&A market generally mirrored activity in the global market, with an active first half of the year before trade uncertainty drastically slowed activity in the third quarter. Regional companies reported 28 deals through the first two quarters, but only seven in the third, before rebounding to 11 in the last quarter of 2019.

Read the full members-only story in this week's print or digital editions of the CBJ.

IMAGE: A chart from this week's CBJ showing regional M&A deals since 2015. SOURCE CBJ Research
Rural Mainstreet Index begins 2020 on stronger footing
A monthly economic survey of rural Midwest bankers reached its highest level this month since June 2018, despite expectations for a further decline in farm equipment sales and borrowing in 2020, reports the Des Moines Business Record .

The Creighton University Rural Mainstreet Index rose to 55.9 for January, up from 50.2 in December. It was the 11th time in the past 12 months that the index has been above the 50.0 growth-neutral mark. The index is based on a monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and energy.

Although fewer Midwest banks reported that their local economy was in an economic downturn compared with a year ago -- 22.9% currently versus 17.7% -- bankers also said they expect farm equipment sales to decline by an additional 4.2% this year.

At the same time, the index’s employment gauge advanced to a "very healthy" 61.8 from December’s 60.0. Despite the trade war and weaker manufacturing in rural areas, Rural Mainstreet businesses are now hiring at a solid pace, Creighton economist Ernie Goss said. Over the past 12 months, the Rural Mainstreet economy added jobs at a 0.4% pace, well below the rate of urban-area growth of 1% for the same period.

For Iowa, the January Rural Mainstreet Index increased to 56.1 from December’s 53.5. Iowa’s farmland-price index slumped to 45.3 from December’s 52.5. Iowa’s new-hiring index for January advanced to 57.2 from December’s 48.7.

Iowa’s employment growth is weaker than the region as a whole, however. Over the past 12 months rural areas in Iowa have experienced job losses, with employment growth at minus 0.6%, compared with a stronger 1.1% for urban areas of the state.

Looking at overall numbers for the 10-state region, the January farm equipment-sales index increased to a weak 35.0 from December’s 27.9, marking the 76th month that the reading has remained below growth-neutral.

Additionally, borrowing by farmers weakened again in January. The borrowing index declined to 48.5, its lowest level since February 2013, from December’s 50.0. Farm loans fell to their lowest level in almost seven years.

"Creighton's January survey was conducted before the signing of the Phase 1 trade agreement with China and the Senate passage of USMCA," Mr. Goss said in a statement. "I expect the passage of USMCA and the Jan. 15 trade agreement with China will boost business confidence in the months ahead."
Don't miss your chance to register for Book of Lists unveiling
Tomorrow is the last day to register for the Corridor Business Journal's 2020 Book of Lists Unveiling Reception. 

This new event, to be held Jan. 30 from 5-7 p.m. at Eastbank Venue & Lounge in downtown Cedar Rapids, will bring together the region’s most influential business leaders for networking and the reveal of the 2020 CBJ Book of Lists.

Attendees will be the first to receive the 2020 Book of Lists, the definitive regional resource guide for business leaders and professionals. The Book of Lists features 70 ranked business lists, including Corridor companies by sector, regional market facts and trends, and the people who make it happen.

“If you need a guide to the top businesses and organizations in the Corridor, look no further. We have done all of the legwork for you, gathering the most recent details such as contact information, top local executives and employee counts,” said Book of Lists Editor Angela Holmes. “This networking tool also introduces you to the top boards and business leaders in the region, making it an invaluable resource."

The event will also feature local artist John Paul Schafer, whose work appears on the cover of this year's Book of Lists, and several of his original paintings.

Tickets are $25 and include one drink, appetizers and a copy of the Book of Lists. For more information or to register, visit  www.corridorbusiness.com/events   or call Ashley Moore at (319) 665-6397, ext. 311.
IowaBio opens nominations for Biotech Leader Award
The Iowa Biotechnology Association (IowaBio) is now accepting nominations for this year's Iowa Biotech Leader Award, to be presented on March 11 at its annual Partnering for Growth conference.

The award will be presented to an individual who, in the past year, has demonstrated the following traits and commitment to advancing Iowa's biotech industry:

Leadership - The individual has a leading role in their organization and within the industry.
Innovation - The individual has consistently demonstrated an ability to bring innovative biotechnology products and/or services to the marketplace.
Advocacy - The individual works effectively with other business and public policy leaders to promote and advance the biotech industry in Iowa.

Dr. Michael Abramoff, the founder and CEO of Coralville-based IDx, received the award last year for his work developing the first-ever FDA-approved medical device to use artificial intelligence to diagnose a disease.

This year's recipient will be determined by a committee of individuals with roles in Iowa's biotechnology industry. Nominations will be accepted until Feb. 7 at www.iowabio.org/biotechleader.


Employers, take our short health care survey

The CBJ is prepping for a new feature series on the cost of health care, and we're looking for your input as an employer, business owner or HR representative. How has your company adapted or changed its health coverage in recent years? Take our short, confidential survey here.
Short Term Event Planner

Jan. 23
Small Business Breakfast Roundtable, by SCORE East Central Iowa, 7:30-9 a.m., Scott’s Family Restaurant, 1906 Blairs Ferry Road NE, Cedar Rapids. This networking opportunity offers a chance to share best practices and get help with business challenges. Free. To register, visit conta.cc/35uaw9f .
 
Marion State of the City Luncheon, by League of Women Voters of Linn County and city of Marion, 11:30 a.m.-1 p.m., Cedar Rapids Marriott, 1200 Collins Road NE. Mayor Nicolas AbouAssaly will review the city's accomplishments of the past year and look ahead to 2020. Cost: $41.18, or $401.18 for a table of 10. Register at lwvlinncounty.org .
 
Six Steps to a Better Business, by SCORE East Central Iowa, 11:30 a.m.-1 p.m., Cedar Rapids Public Library, 450 Fifth Ave. SE. This workshop will unpack six essential steps to building a better business. Free. To register, visit conta.cc/2P4bdjH .

PCI Medical Pavilion 2 Open House, by Cedar Rapids Metro Economic Alliance, 4-6 p.m., Medical Pavilion 2, 275 10th St. SE, Cedar Rapids. A ribbon cutting ceremony will be held at 4:30 p.m. Tours of the new facility will be offered. Free. For more information, visit bit.ly/37H9PtZ .

Jan. 24
Mental Health in the Workplace Webinar, by Kirkwood Corporate Training, 1-1:30 p.m., online. Learn about the risk factors and warning signs for mental health and addiction concerns, strategies for how to help someone in crisis, and where to turn to for help. Free. To register, visit kirkwood.edu/signup .
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Headlines from CBS2/FOX 28
These news items are provided by CBS2/FOX 28  
 
Officials responded to a helicopter crash at the Independence Municipal Airport in Independence on Tuesday. Fire officials told CBS2/FOX 28 news that the crash happened around 4:25 p.m. The helicopter had one person inside and that person was taken to the hospital, according to officials. Authorities say the helicopter crashed into another aircraft on the ground and into the main airport building. Officials said they don't know where the helicopter was coming from, and that the Federal Aviation Administration will be on scene today to investigate.

With word that the first case of coronavirus has been diagnosed in the U.S., health officials in Iowa are monitoring the latest information from their federal counterparts. But, they say, there is no cause for concern right now in Iowa. "How will it spread, we don't know yet because we're still learning about it, how prevalent it will be we don't know yet, so there's just a lot of things we just don't know," said Heather Meador with Linn County Public Health. The outbreak remains in its very early stages. And while there are signs of human to human transmission, containment should keep Iowans safe from the virus unless they travel to affected regions of China. Read the full story here.
These news items are provided by CBS2/FOX 28  
CBS2 Weather First Forecast
The first of two waves of moisture arrive with a wintry mix and snow developing in the late morning with periods of snow showers likely through the day and night. Amounts of 1-3" are likely. It'll be a wet snow and with temperatures around freezing. Therefore, impacts on roads should be relatively low, however some slushy and slick spots will be possible at times. Light snow will continue Thursday morning and there may be periods of rain/freezing rain mixing in with temperatures near freezing. There will be another wave that moves in, primarily light snow, Thursday night into Friday.