- Knight has failed to build a meaningful business or create
long-term shareholder value, despite tremendous opportunities and
unprecedented resources
- Knight share price has been floundering for over three years,
significantly underperforming other pharmaceutical companies
- Current Board and CEO are conflicted and entrenched, wasting
corporate assets by attacking shareholders in an attempt to divert
attention from the Company's poor execution and performance
- Medison has developed a comprehensive plan to help Knight
become a growing and profitable Canadian-based pharmaceutical
company by 2025; new directors are needed to ensure the
implementation of this plan
- In addition to current director Meir Jakobsohn, Medison has
nominated five independent, experienced leaders from the
pharmaceutical industry who will oversee Knight without conflict or
compromise
- 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 8, 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 filed a dissident
information circular ("Medison's Circular") in connection
with the Company's upcoming Annual and Special Meeting (the
"Meeting") scheduled for May 7,
2019.
Medison's Circular proposes a slate of six exceptional nominees
for election as directors at the Meeting. In addition to
Medison's CEO, Meir Jakobsohn, a proven pharmaceutical leader who
has served on the Knight Board since 2015, Medison has nominated
five independent pharmaceutical executives (the "Independent
Nominees"), all of whom have no personal or financial ties to
Knight, Medison, Mr. Jakobsohn or Knight CEO Jonathan Goodman. In contrast to the
current directors, the Independent Nominees will not work for the
benefit of the CEO or any individual shareholder. Instead, they are
committed to overseeing Knight in a fair and objective manner and
are focused on maximizing value for all shareholders.
"Knight is a failure, which is why markets ascribe only
$0.25 per share in value to the
future plan and business," said Medison CEO Meir Jakobsohn.
"Knight has tremendous opportunity and was founded with an
inspiring vision, but five years later it has only 0.05% of the
pharmaceutical market in Canada
and no pharma operations outside of Canada. The Company and its stock price can
and will grow, but only when management and the Board focus on the
business, stop hoarding hundreds of millions of dollars and take
decisive actions without delay. At the current pace of development,
Knight may be able to garner 1% market share twenty years from now;
that is not even good enough for our grandchildren."
"Sadly, the incumbent Knight Board and Mr. Goodman are now
focused on protecting their own entrenched and entwined interests.
They would rather spend millions of dollars of shareholders' money
asserting hypocritical, false and baseless claims aimed at
silencing shareholders than address legitimate concerns about
Knight's failing performance. Unlike the current Board, the
Independent Nominees will act solely in the interests of the
shareholders who elect them. They bring a common-sense plan
to realize Knight's potential – for shareholders and patients alike
– and the deep industry experience that is necessary to effectively
oversee and guide Knight on a positive path forward, without
compromise or conflict."
Medison believes Knight shareholders should expect more from
Knight and should vote for the Independent Nominees because:
- Knight has failed to build a specialty pharmaceutical
business. Five years after its founding, Knight only markets
three drugs, has generated life-time revenue of just $25 million from pharmaceutical products and has
incurred operating losses every quarter. Instead of building an
operating pharmaceutical business, Knight has stockpiled cash and
functions more like an investment firm, investing in venture
capital funds and fund-of-funds and making loans to various and
sundry healthcare companies, without any identifiable strategic
purpose.
- Knight's stock has underperformed its peers and the
market. Knight's stock has underperformed its relevant peers
and the broader market in the one-, two- and three-year periods
ended March 31, 2019 and in the first
quarter of 2019.
- Knight is valued only for its cash and holdings, not its
business or potential. The Company's stock price indicates the
market does not believe Knight will build a successful operating
business. Fully 97% of the value of Knight's market value reflects
the cash and passive holdings on its balance sheet. Just 3% of the
stock price ($0.25 per share) can be
attributed to the value of Knight's business and vision.
- Knight's CEO is conflicted, and his interests are not
aligned with all other Knight shareholders. Mr. Goodman owns
more of Pharmascience, which has recently become a significant
competitor to Knight, than he owns of the company he serves as CEO.
Knight first disclosed the competition in 2017 and despite this
critical change in circumstance, Mr. Goodman asserts that
shareholders should trust him to disregard his own economic
interest while he runs Knight. Mr. Goodman's recent disingenuous
act of placing his Pharmascience interest in a "blind trust" is
wholly ineffective – Mr. Goodman knows he still owns more of
Pharmascience than Knight. We believe shareholders should
expect their CEO to be fully committed and aligned with the success
of the organization he or she runs.
- The incumbent directors are entangled with the CEO and each
other. There are longstanding relationships between every one
of the incumbent directors and the CEO, including financial and
business partnerships and relationships that compromise the role of
the incumbent directors as fiduciaries for shareholders.
Shareholders deserve and are entitled to independent
oversight. The fact that Mr. Goodman recently told a reporter that
he would not work under an independent Board should cause all
shareholders to doubt whether his hand-picked directors have
fulfilled their duties to provide rigorous oversight of Knight and
Mr. Goodman.
- There is a better plan that can create growth and profit,
and increase Knight's stock price. Medison has developed a
comprehensive plan for building Knight into a leading,
Canadian-based pharmaceutical company that commercializes
innovative therapeutics for life-altering and life-threatening
diseases. There is enormous potential to create a growing and
profitable business delivering these medicines to patients in
Canada and other "rest of world"
markets. Medison has provided extensive detail on this opportunity
in a presentation available at www.NewDayForKnight.com.
- The Independent Nominees are experienced, objective and
talented. Medison has identified and recruited five
extraordinary pharmaceutical executives who are willing to serve
Knight's shareholders by overseeing the strategy and execution at
Knight. Unlike the incumbent directors, the Independent Nominees
have decades of operating experience inside respected
pharmaceutical companies and have no ties to Mr. Goodman (or to
Medison, Mr. Jakobsohn or Knight).
"For three and a half years, Medison and other Knight
shareholders have earned nothing on our investments in Knight,"
concluded Mr. Jakobsohn. "We know Knight's shareholders share our
frustration and want change. Significant shareholders we have
talked to say they want a new strategy, new oversight and new
directors. I encourage all Knight shareholders to carefully review
our plan and the impressive biographies of each of the Independent
Nominees. Together, we can grow the business, help patients, and
generate strong returns for shareholders. It is time for a New Day
for Knight."
For more information on the Independent Nominees and the reasons
Knight shareholders should support change, Medison encourages
shareholders to read Medison's Circular, which is available at
www.NewDayForKnight.com.
It's Time for a New Day for Knight
Medison has engaged Olshan Frome Wolosky LLP and Goodmans LLP as
legal advisors.
About Medison
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 the 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.