VANCOUVER, April 5 /PRNewswire-FirstCall/ - AnorMED Inc. 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 (www.anormed.com ) and SEDAR at 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 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 April 27, 2004 - March 30, 2006 (www.anormed.com/images/stock_key_events.gif) Poor performance of companies with Baker as a Board member:
The relative performance analysis below is a strong indication of Baker’s poor track record as a Director. The Companies that Felix Baker has served on 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, Trimeris and Intrabiotics. The Baker Index does not include AnorMED. AnorMED’s performance is set out in the previous chart.
- Chart 2: Index of Companies Where Baker is a Board Member vs. Industry Indices (www.anormed.com/images/indices.gif) ------------------------------------------------------------------------- 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, Intrabiotics, 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. ------------------------------------------------------------------------- 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 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 (www.anormed.com ) and SEDAR at 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 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 President & CEO Tel: (604) 530-1057 E-mail: mabrams@anormed.com Elisabeth Whiting, M.Sc. VP Corporate Development & Communications Tel: (604) 532-4667 Cell: (604) 763-4682 E-mail: ewhiting@anormed.com
AnorMED Inc.
CONTACT: Dr. Michael Abrams, President & CEO, Tel: (604) 530-1057, E-mail:mabrams@anormed.com; Elisabeth Whiting, M.Sc., VP Corporate Development &Communications, Tel: (604) 532-4667, Cell: (604) 763-4682, E-mail:ewhiting@anormed.com