AnorMED dissidents fail to justify giving control of AnorMED to Baker Group
07 April 2006 - 5:33AM
PR Newswire (US)
Felix Baker criticizes decisions that he approved as Director of
AnorMED VANCOUVER, April 6 /PRNewswire-FirstCall/ -- AnorMED Inc.
(TSX: AOM; AMEX:AOM) announces today that a proxy circular filed by
a group of dissident shareholders, represented by Felix J. Baker
and seeking to replace the AnorMED Board of Directors, includes
extensive criticism of decisions which Felix Baker, himself,
approved as a Director of the Company since April 2004. The opinion
of the Company is that the criticisms are not credible and that The
Baker Group is attempting to gain control of the Company without
paying a control premium and without a plan to maximize shareholder
value. At a special meeting of the Company on April 21, 2006,
AnorMED is nominating a slate of directors that includes three new
nominees with additional expertise in drug commercialization,
operational and financial leadership and the management of
profitable companies. The dissident group is attempting to have its
slate of nominees elected to replace the AnorMED slate. The
dissident proxy circular contains many broad-based criticisms
including: "The Current Board has failed to supervise and guide
management and has not taken action to address AnorMED's failures
and underperformance." However, as a director of AnorMED, Baker has
approved all final decisions regarding corporate strategy, annual
budgets and program resource allocation, as recently as February
2006. Baker was also a member of the Company's Compensation
committee, and as such approved the Company's annual goals,
including this year's goals which include the pursuit of a
partnership and early approval strategy for MOZOBIL, AnorMED's lead
product in Phase III clinical trials. AnorMED shareholders should
consider the following information to assist them in making an
informed choice on the election of the Board of Directors on April
21, 2006: - Baker never questioned the Board's capabilities until
it decided in November 2005 to decline his various proposals that
involved paying Baker Bros. Advisors a fee to backstop a rights
offering. This could have resulted in dissident shareholders
acquiring up to 36% of AnorMED shares without paying a control
premium. - Although Baker voiced strong disagreement with the
Board's decision to pursue a bought deal, dissident shareholders
purchased 40% of the shares sold in the bought deal. - Partnering
MOZOBIL in Europe has been AnorMED's publicly stated strategy for
the past two years. Partnering discussions regarding MOZOBIL have
been underway since September 2005 and have advanced to a late
stage. The Board has and will continue to exercise its fiduciary
responsibility to evaluate all opportunities, including
alternatives to a European deal, with equal diligence. Europe
represents 50% of the world market and a partnership should
accelerate the approval process that, if successful, would bring
earlier generation of revenue. - The AnorMED Board and Management
believe the dissident proxy circular grossly underestimates: - The
resource requirements and execution risk in launching a product in
Europe; - The negative impact on MOZOBIL revenue potential by
delaying a European partnership; and - The development and
regulatory risk incurred by AnorMED shareholders by delaying a
partnership. AnorMED shareholders are recommended to vote only
their BLUE AnorMED proxy in favour of the AnorMED Slate. Proxies
must be returned by April 19, 2006 at 10:00 a.m. Vancouver time for
your vote to count. The AnorMED Management Proxy Circular, which
has been mailed to shareholders and filed with regulators, is
available on the Company website (http://www.anormed.com/) and
SEDAR at http://www.sedar.com/. For more information call Georgeson
Shareholder, AnorMED's proxy solicitor at their North American toll
free number 1-866-267-8910, or collect at 416-642-7069. If
shareholders previously returned a Yellow Dissident Proxy, they
have every legal right to change their vote, by simply signing,
dating and returning a Blue proxy, as it is only the later dated
proxy that will be counted. Additional information AnorMED
shareholders are encouraged to consider includes: AnorMED stock
increase driven by completion of financing, achievement of
milestones & sector performance: A graphic in the Dissident
Circular illustrates the AnorMED share price increase since
December 13, 2005 when Baker publicly disclosed his concerns over
the company's undervalued shares. Shareholders should not conclude
that Baker's public statements are the only reason for the increase
in AnorMED share price. Four other material events that may have
contributed to the AnorMED stock price increase during this period
are: 1. The completion of the bought deal on December 8, 2005. 2.
AnorMED report of important new MOZOBIL clinical data at the
American Society of Hematology on December 12, 2005. 3. The
improvement of the overall biotech sector performance. 4. AnorMED
report of positive AMD070 data on March 17, 2006. Chart 1: AnorMED
Stock Performance and Key Events, Daily Share Price
http://www.anormed.com/images/stock_key_events.gif Poor performance
of companies with Baker as a Board member: The relative performance
analysis below illustrates that the public companies that Felix
Baker has served on as a director have significantly underperformed
comparable sector indices over the 2-year period illustrated below.
The Baker Index is a simple share price average of Conjuchem,
Neurogen, Seattle Genetics and Trimeris. The Baker Index does not
include AnorMED. AnorMED's performance is set out in the previous
chart. Chart 2: Index of Public Companies Where Felix Baker is a
Board Member vs. Industry Indices
http://www.anormed.com/images/indices2.gif
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NASDAQ Biotechnology Index The NASDAQ Biotechnology Index (NBI) is
a modified market capitalization-weighted index. The index uses
NASDAQ Official Closing Prices in calculating market
capitalizations and is generally calculated without regard to any
dividends on component securities. For a further detailed
explanation of Index calculations please see the NASDAQ website:
http://www.nasdaqtrader.com/asp/nasdaqindexes.asp AMEX
Biotechnology Index The AMEX Biotechnology (BTK) Index is an
equal-dollar weighted index designed to measure the performance of
a cross section of companies in the biotechnology industry. For a
further detailed explanation of Index calculations please see the
AMEX website: http://www.amex.com/. Baker Index The Baker Index is
a simple average of the daily closing prices of Trimeris,
Conjuchem, Neurogen and Seattle Genetics. The Index is not weighted
in any way and AnorMED is not included as part of the Index. The
Index does not account for dividends, if any.
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Dissident proxy unfairly reports on AnorMED progress: AnorMED has
made excellent progress on its drug development program. As a
member of the Board, Baker was informed of all the factors that
contributed to the successes and challenges within each of
AnorMED's programs. Nevertheless, the dissident proxy circular
presents selective information about the Company's drug development
progress. AnorMED shareholders should consider the following
information provided by the Company: MOZOBIL: The Company advanced
the product from Phase I to Phase III clinical trials faster than
industry standards. The Phase III trial is now over 50% complete
and the Company is on track to report Phase III results in 2007.
AMD070: The product targets approximately 40% of the HIV patient
population, whereas products of such companies as Gilead and
Panacos, referred to in the Dissident Circular, target 100% of the
HIV patient population. Therefore, it was expected that it would be
more difficult and take longer to enrol suitable patients for the
AMD070 clinical trials than would be the case with the Gilead and
Panacos products. AnorMED was successful in quickly addressing
significant regulatory requirements regarding drug interactions and
was, therefore, able to initiate its own Phase Ib/IIa study (XACT).
In addition, AnorMED hired an experienced HIV physician as Medical
Director to support the advancement of AMD070 and programs in HIV.
AnorMED reported positive activity and safety data on AMD070 from
XACT on March 17, 2006. CCR5: As a performance comparison, AnorMED
estimates that it took Pfizer approximately four to five years to
identify the CCR5 drug candidate that could enter clinical trials.
AnorMED started working on CCR5 in 2002 with a small team of
chemists and only applied its full medicinal chemistry resources,
of approximately 30 chemists, in 2003. AnorMED has established
several CCR5 drug classes, has screened out several candidates that
failed the preclinical requirements, and is now evaluating
potential candidates. AnorMED's CCR5 timelines are comparable with
Pfizer's, and in fact, if a clinical candidate succeeds in
preclinical studies this year, the Company will surpass the Pfizer
timetable by progressing from full research initiation to clinical
candidate in three years. Cardiac Tissue Repair: Ongoing work at
AnorMED, concurrent with the increasing number of medical
publications showing that multiple stem cell mobilization trials in
cardiac patients have not provided positive results in any modality
or design, prompted the Board and Management to reduce the priority
of the company's cardiac tissue repair program. It is the Company's
view that shareholders' interests are better served by focusing on
other validated programs. AnorMED's commercial strategy optimizes
product value & provides non-dilutive source of cash to support
AOM product pipeline: In support of AnorMED's plan to commercialize
MOZOBIL(TM), the Board and Management hired a Vice President of
Marketing and Director of Medical Affairs to develop and prepare
commercialization plans and to build market awareness for
MOZOBIL(TM). Within the next year, AnorMED also intends to hire a
Chief Operating Officer to build commercial operations. Partnering
MOZOBIL in Europe has been AnorMED's publicly stated strategy for
the past two years. Europe represents 50% of the world transplant
market for MOZOBIL. A European partnership and early approval in
Europe would support the Company's objective to extract a maximum
amount of revenue from MOZOBIL within a shorter time frame. AnorMED
is evaluating potential partnering terms that should eliminate the
Company's need to complete another financing prior to the release
of Phase III results in 2007. Funds from a partnership would be
used to support the ongoing development of MOZOBIL and the
Company's HIV program. Terms discussed to date include significant
upfront payments, milestone payments and royalty rates that reflect
the advanced development stage of the product. The ongoing
discussions suggest that the Company would receive a royalty rate
consistent with rates that could be obtained if the Phase III
results were already known. The royalty rates being discussed are
currently in the range of 25% to 40% of revenue and may vary based
on the magnitude of the milestone payments and the level of
revenue. The hostile process initiated by Baker and a potential
change in control of the Company through the election of the
Dissident's slate of nominees has and will continue to make it
difficult for AnorMED to finalize a partnership. Potential partners
are concerned about the Board's ongoing support of such a
significant collaboration, and have expressed concern regarding the
potential loss of senior management and staff crucial to the
successful execution of the MOZOBIL(TM) program. Election of
dissident slate triggers change of control: The election of the
dissident slate of directors at the AnorMED special meeting April
21, 2006, would result in the Baker Group achieving effective
control of AnorMED. Six of the eight director nominees are business
associates of Baker Bros. Advisors and therefore may not be
considered independent. A change in control will have a significant
financial impact on AnorMED cash resources and potentially result
in the loss of key employees and senior management. The Company is
confident that once shareholders understand the facts and
motivations surrounding the Baker Group's attempt to obtain control
of AnorMED, shareholders will vote for AnorMED's nominee directors,
including Michael Abrams, the current CEO. The Board of Directors
of AnorMED urges shareholders to NOT sign or return any forms of
proxy that may be sent to you by the dissident shareholder group.
AnorMED shareholders are recommended to vote their BLUE AnorMED
proxy in favour of the AnorMED Slate. Proxies must be returned by
April 19, 2006 at 10:00 a.m. Vancouver time for your vote to count.
The AnorMED Management Proxy Circular, which has been mailed to
shareholders and filed with regulators, is available on the Company
website (http://www.anormed.com/) and SEDAR at
http://www.sedar.com/. For more information call North American
toll free number 1-866-267-8910, or collect at 416-642-7069. If
shareholders previously returned a Yellow Dissident Proxy, they
have every legal right to change their vote, by simply signing,
dating and returning a Blue proxy. AnorMED is a chemistry-based
biopharmaceutical company focused on the discovery, development and
commercialization of new therapeutic products in the areas of
hematology, HIV and oncology. The Company has a product in Phase
III development, a product in Phase II development and a research
program focused on a novel class of compounds that target specific
chemokine receptors known to be involved in a variety of diseases
including HIV. Additional information on AnorMED Inc. is available
on the Company's website http://www.anormed.com/. Note: Certain of
the statements contained in this press release may contain
forward-looking statements and forward-looking information within
the meaning of applicable securities laws, including the Ontario
Securities Act, Section 27A of the U.S. Securities Act of 1933 and
Section 21E of the U.S. Securities Exchange Act of 1934. Statements
or information regarding strategy, future operations, future
financial position, future revenues, projected costs, prospects and
plans and objectives of management are forward-looking statements.
The words "anticipates, "believes", "budgets", "could",
"estimates", "expects," "forecasts", "intends", "may", "plans",
"projects", "schedule", "should", "will", "would" and similar
expressions are intended to identify forward-looking statements or
information, although not all forward-looking statements or
information contain these identifying words. Plans, intentions or
expectations disclosed in any forward-looking statements or
information should not be read as guarantees of future results or
events, and will not necessarily be accurate indications of whether
or the times at or by which such results or events will be
achieved. Forward-looking statements or information involve known
and unknown risks, uncertainties and other factors which may cause
the actual results, performance or achievements of the Company, or
industry results, to be materially different from any future
results, performance or achievements expressed or implied by such
forward- looking statements or information. Investors are referred
to the discussion of such risks, uncertainties and other factors in
AnorMED's Final Short Form Prospectus dated December 1, 2005 filed
on SEDAR with Canadian securities regulatory authorities and in
Exhibit 99.1 to AnorMED's Report on Form 6-K filed with the U.S.
Securities and Exchange Commission on December 23, 2005. Except as
required by law, AnorMED expressly disclaims any intention and
undertakes no obligation to update any forward-looking statements
or information as conditions change. For further information: Dr.
Michael Abrams Elisabeth Whiting, M.Sc. President & CEO VP
Corporate Development & Communications Tel: 604-530-1057 Tel:
604-532-4667 E-mail: Cell: 604-763-4682 E-mail: DATASOURCE: AnorMED
Inc. CONTACT: Dr. Michael Abrams, President & CEO, Tel: (604)
530-1057, E-mail: ; Elisabeth Whiting, M.Sc., VP Corporate
Development & Communications, Tel: (604) 532-4667, Cell: (604)
763-4682, E-mail:
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