- Knight is failing, its CEO and Board are conflicted and shareholders are suffering as a result
- Medison's independent nominees are accomplished industry veterans who can objectively oversee and guide Knight
- More information on the director nominees and Medison's comprehensive plan for Knight, including plans to return at least $100 million of excess capital to Knight shareholders in the form of a special dividend or share buyback, is available at www.NewDayForKnight.com
PETACH TIKVA, Israel, April 1, 2019 /CNW/ - Medison Biotech (1995) Ltd. ("Medison"), which together with its affiliates owns more than 10.4 million shares or 7.3% of Knight Therapeutics, Inc. (TSX:GUD) ("Knight" or the "Company"), today announced that it has nominated six exceptional pharmaceutical industry leaders (the "Nominees") for election to Knight's Board of Directors (the "Board") at the Company's 2019 annual general meeting, in accordance with the Company's Advanced Notice By-Law. Other than Medison's CEO, Meir Jakobsohn, who has served on the Knight Board since 2015, none of the Nominees has any ties to Knight or Medison. Each Nominee is committed to overseeing Knight for the benefit of all shareholders.
"Knight has failed to create a specialty pharmaceutical company serving Canada and select rest-of-world markets," said Medison CEO Meir Jakobsohn. "Shareholders, large and small, have invested their hard-earned money hoping, like me, that Knight would succeed. For three years, however, Knight's stock has floundered, and shareholders simply are not seeing the returns that all of us deserve. Rather than seizing opportunities and deploying the Company's ample capital to build a valuable and dynamic operating business, Knight has allowed shareholders' cash to stagnate while Knight meekly sits on the sidelines, dabbling in lending and banking or licensing unremarkable products with modest profit potential."
"Even more importantly, because of Knight's stagnation, millions of people in Canada and around the world are being denied life-saving pharmaceutical products," Mr. Jakobsohn continued. "Knight needs – and its shareholders deserve – enhanced stewardship and oversight from a Board that is fully committed to shareholders and is prepared to deploy Knight's capital to save lives and drive the Company's performance and stock price up."
Knight Shareholders Suffer from a Lack of Execution and Conflicts of Interest
Knight has failed to execute its original vision – failing to become a specialty pharmaceutical company for Canada and select rest-of-world markets. In the past five years, the Company has only generated $25 million in revenue and still only operates in Canada. In most of its efforts and transactions, Knight resembles a financing firm or merchant bank, lending money to various and sundry healthcare companies and investing passively in venture capital funds. Most troubling, the Company sits on more than $750 million in shareholder cash, which generates little or no return.
Knight's current Board and leadership suffer from serious conflicts of interest that have caused the Company to fail to execute Knight's founding and promising vision. The Company's CEO, Jonathan Goodman, owns a larger stake in one of Knight's principal competitors, Pharmascience, than he owns in Knight. This troubling misalignment of interests between Mr. Goodman and all other Knight shareholders is unprecedented: we know of no other CEO that has a greater stake in his competitor's success than in his own.
Exacerbating this conflict of interest, the Chairman is entangled in multiple financial relationships with Knight's management team and Knight's competitor, and the so-called "independent" directors are all personally close to the CEO. As importantly, the current independent directors have no experience operating a commercial pharmaceutical business and thus lack the expertise Knight needs to reach its true potential.
Success at Knight Requires Change at Knight
As Knight's second largest shareholder, Medison believes that more experience and more independence in the boardroom is required if shareholders are to expect improved results. The Nominees all have relevant operating experience in the pharmaceutical industry. They bring best practices and expertise from some of the world's most respected biotechnology and pharmaceutical businesses and experience in finance, corporate development, commercialization, corporate governance and the capital markets.
The Nominees contribute complementary experience in various markets around the world, including substantial experience in Canada, Europe, the Middle East and Africa. Medison believes these industry veterans are well positioned to provide Knight with the Board leadership and oversight it needs to help Knight realize its vision and potential. The Medison Nominees are:
- Kevin Cameron, CEO of Ionetix, a radiopharmaceutical manufacturer, former President of corporate governance firm Glass, Lewis & Co., and an experienced biotech public board member;
- Elaine A. Campbell, the former President and CEO of AstraZeneca Canada and former SVP of DuPont Pharmaceuticals, with operating roles in sales, marketing and business development in the United States and Canada;
- Michael Cloutier, the former General Manager of PTC Therapeutics Canada, former President and General Manager of InterMune Canada, former President and CEO of AstraZeneca Canada, and former President of Pharmacia Canada (now Pfizer);
- Meir Jakobsohn, the CEO of Israel-based Medison Biotech (1995) Ltd., which he founded in 1996, and which has become one of the world's leading commercial partners for pharmaceutical and biotech companies and one of the three largest pharmaceutical companies in Israel by sales, generating over $250 million annually;
- Christophe Robert Jean, the former EVP of Ipsen Group, former President and CEO of the pharmaceutical operations of Pierre Fabre Group and former Head of Region Europe, Middle-East and Africa for Novartis; and
- Bob Oliver, the former President and CEO of Otsuka America Pharmaceutical, former Chairman of Otsuka Canada Pharmaceutical and former SVP for Commercial Operations at Pfizer.
Full bios for the Nominees appear below and are available at www.NewDayForKnight.com.
There is a Better Plan
Medison has developed a comprehensive strategic plan for Knight, also available at www.NewDayForKnight.com. The plan is built on three strategic principals:
- commercializing only high-value, innovative pharmaceutical products that treat life-altering or life-threatening diseases, in focused therapeutic areas;
- distributing products in multiple rest-of-world markets chosen for their commercial attractiveness and compliance cultures; and
- returning excess capital to Knight shareholders.
Medison believes this plan will lead to substantial share price appreciation and more than $500 million of annual revenue by 2025, as well as the return of at least $100 million of the Company's cash to shareholders, immediately.
Knight's Attempts to Silence Criticism and Distract Shareholders
Medison's efforts to improve execution and eliminate conflicts of interest at Knight have been welcomed by shareholders but rebuffed by the incumbent Knight Board. In fact, the Knight Board has likely wasted millions of dollars pursuing nuisance claims against Medison that appear to be calculated to distract shareholders and thwart Medison's efforts to improve Knight's performance. In particular, Knight's Board has:
- suddenly, and on pretextual grounds, sought thousands of pages of accounting records and corporate information from Medison, after three-and-a-half years of seemingly happy and passive ownership of Medison;
- attempted to prevent Medison from communicating with Knight's shareholders by stopping Medison from using Knight's TSX ticker symbol ("GUD") in press releases;
- sued Medison to prevent Medison from spending its own money to protect its substantial economic stake in Knight (and in the process improperly revealed highly confidential information about Medison); and
- demanded, for the first time, that Medison turn over dozens of confidential and sensitive commercial and investment agreements.
Medison believes that instead of squandering further shareholder capital on such efforts, the Company's Board and management should focus on improving Knight's performance.
In contrast to Knight's blatant and expensive attempts to sidestep Medison's campaign for change and accountability, Medison has been focused on helping Knight succeed. In the last few weeks, Medison has:
- released an extensive analysis of the performance issues and conflicts of interest at Knight that impede the realization of Knight's vision and the creation of shareholder value;
- met with fellow Knight shareholders, who have shared their concerns about Knight's underperformance, failure to execute on its strategy and seeming inability to realize its promising vision and opportunity;
- developed and presented to the Knight Board (and released to shareholders) a comprehensive presentation and to fix Knight; and
- recruited five exceptional independent director nominees to help oversee Knight.
Medison will continue to do whatever is necessary to protect and enhance its investment in Knight and further the interests of all Knight shareholders.
"While Mr. Goodman frequently urges patience and claims to be building value for his grandchildren, we believe our strategy will build value for him, his children and his grandchildren. Long-term value creation can and must begin today," concluded Mr. Jakobsohn. "I am fully confident that bringing on these highly qualified, independent board members with decades of proven success can lead to immediate progress and improvements at Knight. I am humbled by the overwhelming support I have heard from shareholders to this new direction. Together, we can and will turn around Knight's performance and stock, revamp Knight's failing strategy and reinvigorate Knight's faltering execution."
Shareholders are encouraged to visit www.NewDayForKnight.com for more information and to review Medison's comprehensive plan for Knight.
Biographies of Medison's Nominees
Mr. Cameron is the Chief Executive Officer of Ionetix Corporation, a privately held biotechnology company focused on providing diagnostic imaging agents and radiotherapeutics. Before joining Ionetix, Mr. Cameron was the co-founder and President of Glass Lewis & Co., a leading provider of corporate governance services to institutional investors that is owned by the Ontario Teacher's Pension Plan and the Alberta Investment Management Company. Prior to that, Mr. Cameron was a financial and legal officer with Moxi Digital and a legal officer of NorthPoint Communications (NASDAQ: NPNT). Mr. Cameron started his career as an attorney with the law firm of Kellogg, Huber, Hansen, Todd & Evans in Washington D.C., and also served as a law clerk for the United States Court of Appeals for the District of Columbia Circuit. Mr. Cameron holds a law degree from the University of Chicago and an undergraduate degree from McGill University. Mr. Cameron currently serves as a board member of Xyphos Biosciences, a biotechnology company focused on next generation CAR-T therapy, as well as ProCure Treatment Centers, a leading developer of proton therapy centers. Between 2007 and 2018 Mr. Cameron served as a member of the board of directors of Keryx Biopharmaceuticals (NASDAQ: KERX), a biopharmaceutical company focused on therapies for renal patients, that recently merged with Akebia Therapeutics (NASDAQ: AKBA) to create a billion dollar market capitalization company focused on renal disease. Mr. Cameron is originally from Edmonton, Alberta and is a citizen of Canada and the United States.
Elaine A. Campbell
Ms. Campbell currently works part time as a consultant after retiring in 2016. In 2016, Ms. Campbell completed her interim role as President at Innovative Medicines Canada, having led a strategy review and the operation of the national trade association while the Board searched for a long-term President. Ms. Campbell retired from AstraZeneca in 2015, having served as President and CEO of AstraZeneca Canada Inc. since January 2012. She held a number of senior leadership roles within the AstraZeneca US and Global organizations, including Vice President of Global Marketed Brands, led teams located in the US and Europe, and was the Global head for the CRESTOR® Global Project Team, leading both Development and Commercial groups during a period of high growth for the medicine. Prior to joining AstraZeneca, Ms. Campbell was a Senior Vice President and member of the Business Operating Team with DuPont Pharmaceuticals. During her tenure with DuPont, she held various senior leadership roles within the sales, marketing, and business development groups in the US and in Canada. Ms. Campbell is on the Board of Directors of MaRS Discovery District, and serves on the Advisory Board of the University of Toronto Department of Chemical Engineering. She was the Founding Private Sector Co-Chair of the TOHealth! human health sciences cluster initiative of the Toronto Regional Board of Trade and continues to support the project as an Advisor to the Steering Committee and as Chair of the Marketing Sub-Committee since stepping down from the Co-Chair position in September 2015. Ms. Campbell holds a Bachelor of Applied Science in Chemical Engineering from the University of Toronto and a Master of Business Administration from St. Joseph's University in Philadelphia. In May 2016 she completed the ICD Directors Education Program (DEP) at the Rotman School of Business at the University of Toronto. Ms. Campbell is a citizen of Canada and the United States.
Mr. Cloutier is the Founding Partner, director and officer of Accelera Canada Ltd., which he founded in 2016. Accelera provides comprehensive strategic planning for global biotechnology firms. Between 2015 and 2016, Mr. Cloutier served as General Manager of PTC Therapeutics Canada ULC, the Canadian subsidiary of PTC Therapeutics, Inc. (NASDAQ: PTCT), a global leader in research and commercialization of ground-breaking therapies for orphan diseases. From 2013 to 2015, Mr. Cloutier was President and General Manager of InterMune Canada Inc., the Canadian subsidiary of InterMune (NASDAQ: ITMN), a global leader in research and commercialization of novel therapy for Idiopathic Pulmonary Fibrosis that was acquired by Roche for $8.3 billion, and from 2010 to 2012 he served as President and Chief Executive Officer of the Canadian Diabetes Association. Mr. Cloutier was previously CEO of Critical Outcome Technologies Inc., Vice President of Human Resources and Global Marketing at Astra Zeneca, President and Chief Executive Officer of Astra Zeneca Canada (at which time AstraZeneca was the second largest pharma company in Canada with over 1,000 employees and experienced sales growth from approximately $800,000 to over $1.2 billion), President of Pharmacia Canada (now Pfizer Inc.), and President of Searle Canada. Mr. Cloutier holds a Business Administration Diploma from Sheridan College and a Strategic Management Certification from Wharton Business School. He previously served as a Director of Paladin Labs Inc., a publicly traded specialty pharmaceutical company from July 2003 until October 2003 (when he resigned to become the President of AstraZeneca Canada, Inc.) and as a Director of Dimethaid Research Inc. from May 2003 until September 2004. From July 2013 to May 2017, he served as Director and from March 2014 onward, as Chairman, of Merus Labs International, Inc., a publicly traded company focused on acquiring legacy and growth pharmaceutical products. He serves as Chairman of Arylide Life Sciences, a privately held company that commercializes healthcare products. Mr. Cloutier is a citizen of Canada.
Mr. Jakobsohn is the CEO of Israeli-based Medison Biotech (1995) Ltd. which he founded in 1996 and spearheaded to becoming one of the world's leading commercial partners for pharma and biotech companies, and one of the three largest pharmaceutical companies in Israel by sales. Under his leadership, Medison grew to become the partner of choice for biotech companies that produce highly innovative, cutting edge therapeutics for commercialization in the Israeli market. Formerly, he served as the Chief Operating Officer of M. Jakobsohn Ltd., a pioneer in opening the Israeli market to global pharmaceutical companies like Ciba-Geigy, which it represented between 1937 and 1995. Mr. Jakobsohn holds a BA in Economics from Bar-Ilan University and an Executive MBA from Bradford University in the UK. Mr. Jakobsohn is also a social entrepreneur and, among others, he founded and is the driving force behind the "Talmud Israeli", a global educational project that focuses on building meaningful inter-generational (parents-children) connection through Talmudic studies and Jewish values. Mr. Jakobsohn is a member of the Board of Directors of Knight Therapeutics (TSX: GUD), Sabar Health and Alpha Tau Medical. Mr. Jakobsohn is a citizen of Israel and Belgium.
Christophe Robert Jean
Mr. Jean is currently a Senior Advisor to JSB Partners, which offers specialized investment banking and advisory services to biotechnology and pharmaceutical companies. Between 2013 and 2018, when he retired, Mr. Jean was Executive Vice President, Corporate Strategy, Business Development and Alliances of Ipsen Group, a leading pharmaceutical company focused on the development of innovative medicines in oncology, neuroscience and rare diseases. From 2002 to 2013, Mr. Jean served as Ipsen's Chief Operations Officer, during which time Ipsen transformed itself into a leading specialty pharmaceutical company, was listed on Euronext in 2005, and saw its market capitalization increase by over 400% by the end of 2018. Mr. Jean has also served as President and Chief Executive Officer of pharmaceutical activities at Pierre Fabre Group, and as Head of Region Europe, Middle-East and Africa and as a member of the worldwide Pharmaceuticals Executive Committee Board at Novartis. Mr. Jean holds an undergraduate degree in Economics from ITAM, Mexico City and an MBA from Harvard Business School. Mr. Jean is a member of the Board of Directors of Rhythm Pharmaceuticals Inc. (NASDAQ: RYTM), a company developing therapies for the treatment of rare genetic obesity disorders, of Keosys Group, a company specializing in medical imaging software and related services, and of B Cell Design, a biotechnology start-up developing innovative products and breakthrough therapeutic concepts. Mr. Jean is a citizen of France.
Mr. Oliver currently serves as an Executive Advisor to CELLIX BIO Sciences, Inc., sits on the board of directors of Neurotez, Inc., and works as both an Executive Advisor and a board member for Hyalo Technologies. Between November 2017 and July 2018, Mr. Oliver served as CEO of V ClinBio, an innovative biopharmaceutical company driving the development of novel drug products for the treatment of immune diseases. He previously served as Chairman of the Board of Otsuka Canada Pharmaceutical Inc. and President and CEO of Otsuka America Pharmaceutical Inc. ("OAPI"). In these capacities, Mr. Oliver oversaw OAPI's diverse and growing product portfolio within the neuroscience, cardiovascular, oncology and medical device markets. From 2014 to 2016, Mr. Oliver was President and COO of OAPI, during which time he managed a USD$6 billion P&L and was able to maintain profitability even after the loss of exclusivity for OAPI's flagship product, Abilify. Between 2010 and 2014, Mr. Oliver served as OAPI's Senior Vice President of Sales and Marketing. During his long career at OAPI, Mr. Oliver built up the organization's commercial capabilities, partnered closely with Lundbeck to launch Abilify Maintena, and led the transfer of commercial responsibilities for Abilify from Bristol-Myers Squibb to OAPI. Under his guidance, Abilify became the number one selling pharmaceutical in the USA and remained profitable even after the loss of patent protection. Mr. Oliver also spearheaded a structured deal between Neurovance and OAPI which resulted in a strategic collaboration between the companies providing capital for a global development program and was instrumental in transforming OAPI from a single-product company to one with a portfolio of assets with inter-dependency across multiple products. Mr. Oliver has more than 25 years of experience in the pharmaceutical industry. Prior to joining OAPI, he served as Senior Vice President, Commercial Operations, Vice President and Global Business Manager, Oncology, and Vice President, Vaccine Sales, at Pfizer. In these roles Mr. Oliver provided transformational leadership as a member of the US management team and Chair of the US sales council. From 1989 to 2005 Mr. Oliver held senior sales and marketing positions at Johnson & Johnson. Mr. Oliver currently serves as a member of the Board for Academic Fellows at Eastern University, where he mentors doctoral candidates. He has earned an MBA in Marketing from the Haub School of Business at Saint Joseph's University, where he sits on the Pharma Board of Directors, and also has a BA from Rutgers University. Mr. Oliver is a citizen of the United States.
The information contained in this news release does not and is not meant to constitute a solicitation of a proxy within the meaning of applicable securities laws. Shareholders are not being asked at this time to execute a proxy in favour of the Nominees. In connection with the Company's May 7 annual meeting, Medison may file and mail a dissident information circular in due course in compliance with applicable securities laws.
Medison has engaged Olshan Frome Wolosky LLP and Goodmans LLP as legal advisors.
Medison is one of the world's largest commercial partners of leading global biotech companies. Backed by three generations of experience in the healthcare industry since 1937, Medison is uniquely qualified to provide the complete spectrum of integrated services for international companies looking to enter or expand their presence in Israeli and selected ROW markets. Over the years, Medison has become the partner of choice for biotech companies that produce highly innovative, cutting edge therapeutics for commercialization in the Israeli market and is currently one second largest pharmaceutical company in Israel, with over CAD 250 million in revenues annually and over 270 employees. Medison runs a corporate venture arm with a dedicated research and evaluation team boasting deep scientific and commercial backgrounds. Medison also operates a scouting program to cater to its partners and is an active investor in life science projects around drug development and digital health.
Additional information can be found at www.medison.co.il.
Forward Looking Statement
This news release contain forward-looking statements and forward-looking information within the meaning of applicable securities laws, including, without limitation, Medison's and Knight's respective priorities, plans and strategies. All statements and information, other than statements of historical fact, included herein are forward-looking statements, including, without limitation, statements regarding activities, events or developments that Medison expects or anticipates may occur in the future. These forward-looking statements can be identified by the use of forward-looking words such as "may", "will", "expect", "intend", "plan", "estimate", "anticipate", "believe" or "continue" or similar words and expressions or the negative thereof. There can be no assurance that the plans, intentions or expectations upon which these forward-looking statements are based will occur or, even if they do occur, will result in the performance, events or results expected. We caution readers not to place undue reliance on forward-looking statements contained herein, which are not a guarantee of performance, events or results and are subject to a number of risks, uncertainties and other factors that could cause actual performance, events or results to differ materially from those expressed or implied by such forward-looking statements. These factors include: changes in Knight's strategies, plans or prospects; general economic, industry, business, regulatory and market conditions; actions of Knight and its competitors; conditions in the pharmaceutical industry; risks relating to government regulation and changes thereto, including in respect of the regulations concerning board composition, proxy solicitation and shareholder meetings; the state of the economy including general economic conditions globally and economic conditions in the jurisdictions in which Knight operates; the unpredictability and volatility of Knight's share price; and dilution and future sales of securities of the Company. These factors should not be construed as exhaustive. Certain forward-looking statements contained herein may be considered to be future-oriented financial information or a financial outlook for the purposes of applicable Canadian securities laws. Future oriented financial information and financial outlook contained herein about prospective financial performance, financial position or cash flows are based on assumptions about future events, including economic conditions and proposed courses of action, based on the applicable management team's assessment of the relevant information available to them at the applicable time, and to become available in the future. In particular, the information contains projected operational information for future periods which are based on a number of material assumptions and factors. The actual results of the applicable operations for any period could vary from the amounts set forth in these projections, and such variations may be material. Further, there is no assurance or guarantee with respect to the prices at which any securities of Knight will trade, and such securities may not trade at prices that may be implied herein. See above for a discussion of the risks that could cause actual results to vary from such forward-looking statements. Readers are cautioned that all forward-looking statements involve known and unknown risks and uncertainties, including those risks and uncertainties detailed in the continuous disclosure and other filings of Knight, copies of which are available on the System for Electronic Document Analysis ("SEDAR") at www.sedar.com. We urge you to carefully consider those risks and uncertainties. The forward-looking statements contained herein are expressly qualified in their entirety by this cautionary statement. Unless expressly stated otherwise, the forward-looking statements included herein are made as of the date of this news release and Medison disclaims any obligation to publicly update such forward-looking statements, except as required by applicable law.
SOURCE Medison Biotech Ltd.