QVT Financial, the third largest shareholder of VIVUS, Inc. (NASDAQ:VVUS) (FRA:VIU) plans to vote for the nine-member slate proposed by dissident investor First Manhattan Co.
QVT Financial holds about 8.3 percent stake in the pharmaceutical company.
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The investment management firm First Manhattan, earlier received support from proxy advisor Institutional Shareholders Services for three of its nine proposed directors.
The recent support from QVT Financial is a great morale booster for First Manhattan’s efforts to replace VIVUS, Inc. (NASDAQ:VVUS) (FRA:VIU) directors.
First Manhattan’s Views
First Manhattan Co is Vivus’ largest shareholder with 9.9 percent stake. The investment firm seeks to take full control of the pharmaceutical company’s board with its own nominees.
In its recent letter to VIVUS, Inc. (NASDAQ:VVUS) (FRA:VIU) shareholders, the investment management firm First Manhattan Co, justified why its nominees should be elected. The investment advisory firm castigated VIVUS, Inc.’s board for having limited knowledge of finance. It also charged the company of ‘hemorrhaging cash’ and with a ‘poor commercial launch for the best obesity drug ever developed’.
Once touted as a promising therapy to fight a U.S. obesity epidemic, doctors have been slow to pick Qsymia up given the troubled past of obesity drugs. Qsymia’s side effects include heart risks and the possibility of babies being born with oral clefts when taken by women during pregnancy
Vivus Board’s Recommendation
In its letter to the shareholders, VIVUS, Inc. (NASDAQ:VVUS) (FRA:VIU) highlighted under current board’s direction, the management team developed and won FDA approval for Qsymia in 2012. Since then, the management team has worked tirelessly to increase awareness and access, the two main barriers to unlocking Qsymia’s value.
The drug maker also emphasized Vivus made significant progress in establishing obesity as a drug treatment category and broadening reimbursement coverage. Despite FMC’s disruptive efforts, the company has made meaningful progress that is positioning it to enhance stockholder value.
Changes Are Necessary
The investment firm, QVT Financial feels changes are necessary at Vivus.
Former executive vice president for global commercial operations at London-based AstraZeneca plc (ADR) (NYSE:AZN) (LON:AZN), Anthony Zook, agreed to serve as chief executive officer if First Manhattan wins the proxy vote.
VIVUS, Inc. (NASDAQ:VVUS) (FRA:VIU) annual general meeting is scheduled on July 15.