Vivus Inc., the drugmaker that’s battling its largest investor for board control, told investors and analysts at a meeting today that it’s open to discussing a potential settlement with dissident shareholder First Manhattan Co., according to two people at the event.
Vivus would aim to reach a settlement before its annual meeting on July 15, said the people, who asked not to be named because the discussions were private. Vivus’s management team and some directors were present at the breakfast gathering in New York, the people said.
A spokeswoman for Mountain View, California-based Vivus declined to comment. The company received U.S. Food and Drug Administration approval to sell the obesity drug Qsymia in July 2012, and initial sales have disappointed investors, sending shares down 47 percent in the past 12 months. Vivus rose 3.2 percent to $14.70 at the close today in New York.
“We have been and remain willing to implement a settlement,” Alex Denner, chief investment officer at Sarissa Capital Management LP, a board nominee backed by First Manhattan, said today in a telephone interview. He declined to comment further on the situation.
First Manhattan has proposed a slate of nine directors, including Denner, to replace Vivus’s entire board. With 9.9 percent of Vivus’s outstanding stock, the investor has criticized how the company brought Qsymia to market and advocates replacing Chief Executive Officer Leland Wilson.
Vivus expanded its board by three directors since the proxy fight began. The drugmaker has emphasized its plan to help more patients access Qsymia and said it’s talking with large pharmaceutical companies about a partnership to help market the treatment.
“A vote for First Manhattan Co. is a vote for risk,” Vivus said yesterday in a statement. “FMC’s ‘plan’ -– to the extent they have one -– appears to revolve solely around doing things that the Vivus board and management team are already doing, ‘fixing’ things that aren’t broken, or making wholesale changes without an understanding of our business and industry.”
Earlier this week, Vivus’s third-largest shareholder, QVT Financial LP, was reported to plan to vote its 8.35 million shares in favor of First Manhattan.