KNIGHT THERAPEUTICS
KNIGHT THERAPEUTICS
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Knight Addresses Misleading and Self-Serving Plan Issued by Disgruntled Director

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  • The Jakobsohn Scheme is full of glaring holes, inconsistencies, and misleading statements designed to provide Mr. Meir Jakobsohn with access to Knight’s resources for Medison’s sole benefit

MONTREAL, March 14, 2019 (GLOBE NEWSWIRE) -- Knight Therapeutics Inc. (TSX: GUD) ("Knight"), a Canadian specialty pharmaceutical company, today issued the following statement addressing a press release and presentation from Medison Biotech Ltd. (“Medison”) and its CEO, Meir Jakobsohn, who is also a director and shareholder of Knight as the result of a 2015 agreement between the two companies. 

Knight continues to be disappointed by Mr. Jakobsohn’s ongoing attempts to extort Knight’s Board of Directors (the “Board”) into agreeing to a scheme that is not in the best interest of Knight’s shareholders and only advances his own self-serving agenda.  

Knight has attempted to maintain an open and constructive dialogue with Mr. Jakobsohn and, over the past several months, has repeatedly asked him to provide the company with a presentation outlining his views about the company’s strategy and again opened the door for him to present to his fellow directors in person. Unfortunately, it was not until the morning of Wednesday, March 13, that such a presentation was provided on short notice before a scheduled Board meeting.   Despite the limited time the Board had to consider the presentation, it operated in good faith to engage Mr. Jakobsohn in a constructive dialogue in an effort to identify avenues of cooperation that would be beneficial to Knight’s shareholders. Following Mr. Jakobsohn’s presentation, the Board expressed the desire of continuing their dialogue and asked about next steps.  The Board is therefore disappointed by Mr. Jakobsohn’s public release of his presentation and elimination of private discussions. It appears that rather than meaningfully attempting  to find an outcome that is in the best interest of Knight’s shareholders, Mr. Jakobsohn has instead opted to engage in yet another self-serving proxy fight tactic.

“Let’s be clear, the scheme released today is an attempt to extort Knight shareholders for the sole benefit of Mr. Jakobsohn. He wants to take Knight’s resources and reputation and use them to prop up Medison which is making less and less money each and every year since 2015,” said Knight CEO Jonathan Ross Goodman. “The direction he outlines is based on a flawed understanding of the Canadian market, full of holes and inconsistencies, and demonstrates the fact he is devoid of industry experience outside of Israel.  The message we have heard from shareholders since Mr. Jakobsohn launched his campaign has been clear: Do not give him access to Knight’s money and do not risk derailing the steady progress we are seeing.  I can assure all shareholders that we remain committed to successfully executing on our long-term strategic plan and protecting the interests of all Knight shareholders.  We will not allow a 7% shareholder in Knight to use his position to benefit his 70% stake in Medison.”

While Knight will provide more detailed commentary on The Jakobsohn Scheme in due course, shareholders should be aware of an immediate series of glaring holes, inconsistencies, and misleading statements.

THE JAKOBSOHN SCHEME LACKS SUBSTANCE, CREDIBILITY

  • MEIR LOOKING OUT FOR MEIR. Mr. Jakobson’s primary thesis is that Knight should focus its effort on commercializing highly innovative biotech products but he is careful not to say why.  Shareholders should be aware of his motivation and understand that Knight is not averse to these products.  In fact, Knight directly in-licensed highly innovative products and has had and will continue to have discussions with many of the companies that Mr. Jakobsohn names. However, Knight will not make high risk or binary bets with its money that  if successful would disproportionately benefit Medison.  It is because Knight will not adopt this scheme that Mr. Jakobson is trying to gain access to Knight’s funds so that he can carry it out himself to the detriment of our shareholders. The “strategic changes” he is pushing for are entirely self-serving ,not in line with Knight's long-term strategy for value creation and inconsistent with what Knight shareholders invested in.

  • FULL OF HOLES AND INCONSISTENCIES. The Jakobsohn Scheme is filled with misleading information and distorted commentary on everything from Knight’s current strategy to the company’s value creation compared to its peers.  Tellingly, what he has discussed with Knight privately is not consistent with what he is presenting publicly, suggesting that he knows that shareholders will not be receptive to his true cash grab agenda. Mr. Jakobsohn had initially sought $450m of Knight’s cash to be routed to high risk investments, including to a VC fund he himself would operate but now has lowered his public demand to $50m.

  • DOESN’T UNDERSTAND CANADA OR THE INDUSTRY INTERNATIONALLY. The Jakobsohn Scheme is illustrative of the fact that he just doesn’t understand Canada, Knight’s primary market. Mr. Jakobsohn has no understanding of the Canadian pharma market, regulatory requirements, or of public company governance. Moreover, prior to yesterday, in more than three years as a Knight director he has only attended two board meetings in person and has questionable pharma business acumen as Medison, which is solely focused on Israel, has seen declining profits since 2015.
     
  • JONATHAN GOODMAN: KNIGHT FIRST. As Mr. Jakobsohn knows full well, Mr. Goodman is an indirect, passive minority shareholder in Pharmascience.  Decisions at Pharmascience are completely isolated from Mr. Goodman and he provides zero input. Mr. Jakobsohn’s allegations of conflict of interest regarding Mr. Goodman and Pharmascience—a business run separately by Mr. Goodman’s father and brother—are no more than a red herring  that insults the intelligence of Knight’s shareholders, who are aware that Mr. Goodman has competed against Pharmascience since 1996 and will continue to do so to ensure Knight is successful.  Mr. Goodman decided decades ago to chart his own course in the pharmaceutical business, one that is separate from his family, and that decision has served Knight shareholders well.  Mr. Goodman participated in all 5 Knight equity financings and personally invested $75 million at increasing valuations into Knight.
     
  • KNIGHT HAS BEST-IN-CLASS GOVERNANCE PRACTICES.  Knight’s Compensation, Corporate Governance and Nominating Committee ensures that Knight’s Board is comprised of members with the relevant skill-sets and experience to provide effective guidance and oversight.  This is demonstrated in Knight’s commitment to ongoing Board refreshment that has seen several new directors appointed all with Mr. Jakobsohn’s support.

KNIGHT IS ON THE RIGHT TRACK

Knight is confident that it has the right plan in place to build long term shareholder value.

Since its launch in 2014, Knight has:

  • Raised $685 million at increasing valuations ($3.50, $5.25, $6.75. $8.00, $10.00 per share)
  • In-licensed over 20 innovative pipeline products from 10 companies
  • Received FDA approval for Impavido® in March 2014 and sold PRV for US$125M
  • Acquired NeurAxon Inc. and the Neuragen brands
  • Sold or out-licensed rights to Neuragen, Impavido, and NeurAxon
  • Lent over $170m to 15 strategic loan partners generating double digit returns
  • Generated approx. $219m of net income to date (as of Dec. 31, 2018)
  • Cautiously rolled out a Rest of the World licensing strategy with the purchase of 28.3% of Israeli based Medison Pharma Inc. and lending of up to US$25 million (up to an additional US$100 million) to Mexico and Brazil based Moksha8
  • Built the foundation for a successful Canadian based specialty pharma company focused on Canada and select international markets.

Knight’s strategy is on track: As reported in Knight’s Q4, 2018 report, year over year revenue and net income increased by 45% and 40% respectively. The company has a well-defined strategic plan —regularly reviewed and refined to maximize shareholder value—that is working.

Knight advises shareholders to take no action with respect to Mr. Jakobsohn’s latest missive. The Board and its advisors will carefully review the ideas included and provide a detailed response to shareholders in due course.  

Advisors
Knight has retained Kingsdale Advisors as its strategic shareholder and communications advisor and Davies Ward Phillips & Vineberg LLP as its legal advisors.

About Knight Therapeutics Inc. 
Knight Therapeutics Inc., headquartered in Montreal, Canada, is a specialty pharmaceutical company focused on acquiring or in-licensing and commercializing innovative pharmaceutical products for the Canadian and select international markets. Knight Therapeutics Inc.’s shares trade on TSX under the symbol GUD. For more information about Knight Therapeutics Inc., please visit the company’s web site at www.gud-knight.com or www.sedar.com.

Forward-Looking Statement

This document contains forward-looking statements for Knight Therapeutics Inc. and its subsidiaries. These forward-looking statements, by their nature, necessarily involve risks and uncertainties that could cause actual results to differ materially from those contemplated by the forward-looking statements. Knight Therapeutics Inc. considers the assumptions on which these forward-looking statements are based to be reasonable at the time they were prepared, but cautions the reader that these assumptions regarding future events, many of which are beyond the control of Knight Therapeutics Inc. and its subsidiaries, may ultimately prove to be incorrect. Factors and risks, which could cause actual results to differ materially from current expectations are discussed in Knight Therapeutics Inc.'s Annual Report and in Knight Therapeutics Inc.'s Annual Information Form for the year ended December 31, 2018. Knight Therapeutics Inc. disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information or future events, except as required by law. 

CONTACT INFORMATION:

Investor Contact:
Knight Therapeutics Inc.
Samira Sakhia
President & Chief Financial Officer
T: 514-678-8930
F: 514-481-4116
info@gudknight.com 
www.gud-knight.com 

Media Contact:
Kingsdale Advisors
Ian Robertson
Executive Vice President, Communication Strategy
Direct: 416-867-2333
Cell: 647-621-2646
irobertson@kingsdaleadvisors.com  

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