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Tech Industry

Drkoop stock available over the counter

The online health site is delisted, adding to the growing number of tech firms listed on the over-the-counter bulletin board after being kicked off the Nasdaq.

After being delisted from the Nasdaq Stock Market on Monday, Drkoop.com stock is available only over the counter.

The over-the-counter bulletin board, or OTC, is filling up with tech companies kicked off the Nasdaq because their stock price stayed below $1 for too long.

Drkoop Chief Executive Richard Rosenlatt said the shift to the OTC will have "no effect on our continuing efforts...We intend to continue our expansion through acquisitions and internal growth."

Drkoop has been on a buying spree since closing its Austin, Texas, headquarters in January and laying off 45 people. In recent months the company has bought IVonyx, which provides home services for intravenous drips, for about $7 million in cash and stock; teamed with another health site, ConnectivCorp, to create an online sexual health site; and arranged a stock deal to buy StayFitUSA.com, a U.S. provider of wellness benefit programs for large employer groups.

The online health site is one of hundreds of companies delisted in recent months, among them many former high-flying dot-coms and technology companies. Last week, online gaming and content site TheGlobe.com was delisted--about 18 months after it scored an amazing first-day gain of over 600 percent, one of the largest first-day gains ever on the exchange.

Delisting doldrums
Well-known high-tech companies litter the list of those delisted from the Nasdaq since the beginning of the year:
Company Date delisted
Drkoop.com 4/30
PSINet 4/27
TheGlobe.com 4/23
Convergent Communications 4/17
Muse Technologies 4/16
VitaminShoppe.com 4/16
CD Warehouse 4/10
eGames 4/2
MyTurn.com 3/30
Xpedior 3/26
Audiohighway.com 3/26
Giga Information Group 3/23
CyberCash 3/21
eToys 3/8
ClickNsettle.com 2/28
NorthPoint Communications 2/8
Mortgage.com 1/30
Bankrate 1/29
Garden.com 1/25
Popmail.com 1/22
Pets.com 1/19
Quepasa.com 1/18
PlanetRx 1/16
Source: Nasdaq News
Other companies delisted since December include PlanetRx, Quepasa.com and Mortgage.com.

Under Nasdaq rules, companies get a delisting warning after their shares have sunk below $1 or $5, depending on the stock, for more than 30 days. A warning means the company has 90 days to get the shares up above the minimum bid price for 10 consecutive days during that time.

If not, they are delisted and the stocks generally move to the OTC, an exchange run by the National Association of Securities Dealers. The OTC is a regulated quotation service that displays real-time quotes, prices and volume information for the more than 3,500 small-capitalization companies traded over the counter. One step below the OTC is the pink sheets, a stock quotation service that handles such high-risk ventures and isn't regulated by the Securities and Exchange Commission.

A company can appeal a final delisting notice. Nasdaq allows a company 45 days or until the appeal is complete before dropping the listing. According to a Nasdaq executive, however, the majority of appeals are denied. Among the companies currently appealing a delisting notice are Webvan, Internet service provider Covad Communications and Netpliance.

For some, it's a race to see if a company shuts down or gets delisted first: eToys, Garden.com and Pets.com all closed at about the same time they were due to be delisted.

Once a stock sinks to "penny stock" status under a dollar, it is hard to boost the stock price. One increasingly popular method is a reverse stock split--but it has had very poor results lately.

Two weeks ago, Quokka issued investors one share for every 50 shares they held. The shares, priced at 7 cents before the split, were artificially valued at more than $3. But as soon as trading began, the value plummeted more than 50 percent.

Webvan, which filed for an appeal two weeks ago, said Thursday that it will attempt a reverse 25-to-1 stock split. Webvan's stock has traded for as little as 6 cents and was last above $1 on Nov. 24.