Sets the Record Straight on Diffusion’s Misleading Narrative and Raises Concerns about a Troubling Pattern of Entrenchment and Lack of Accountability on the Board
Has Nominated a Slate of Highly Qualified Directors
LifeSci Special Opportunities Statement
“The Company’s
Further, the announcement of the strategic review process appears to be a desperate and thinly veiled effort to distract stockholders and the market from the Company’s failures, including the Board’s and management’s inability to develop their lead asset, Trans Sodium Crocetinate (TSC), and the catastrophic erosion of Diffusion’s cash balances and stockholder value that has occurred under their leadership. We believe that stockholders will be able to see through these transparent attempts to deflect attention away from the Company’s operational and share price underperformance, including the fact that the Company’s share price has declined by approximately 78% from
We encourage stockholders to review our proxy materials as they become available, which will include additional information regarding our concerns with the Company.”
Background Information
On
Since
“There is no timeline for this review and there is no assurance that the Board’s review will result in any transaction being consummated. Diffusion does not intend to comment on the process or make further disclosures until it determines an update is appropriate.”
LifeSci Special Opportunities, as a large stockholder of the Company, is naturally concerned about the Board’s motives and willingness to actually engage in substantive conversations that, in our view, would result in the Company achieving its stated goal of enhancing shareholder value. LifeSci Special Opportunities is also concerned that the Company has not held an annual meeting to elect directors in nearly 17 months, which appears to be yet another entrenchment tactic by the Board to maintain the status quo. When the 2022 Annual Meeting of stockholders is finally held (assuming the Company does not delay it again), it will be over 18 months since directors were elected at the 2021 annual meeting of stockholders. Furthermore, it appears the Company only announced that it would hold the 2022 Annual Meeting as a reactive measure to external pressure, such as the third party offer from LS Capital’s client, and did so with very little notice, which prompted an accelerated timeline for stockholders to provide notice of any nominations or business proposals. The timing of the Company’s public announcement of its strategic review process also seems to be only in response to the unsolicited offer to acquire the Company rather than any genuine initiative by leadership to take actions that are in the best interest of Diffusion stockholders. We also question the circumstances surrounding the recent and abrupt weekend-resignation of one of the Company’s directors that was announced concurrently with the Company’s misleading press release.
In LifeSci Special Opportunities’ view, these are all clear and unfortunate symptoms of a reactive and troubled Board that is trying to avoid being held accountable by its stockholders.
The Urgent Need for Fresh Perspectives
Given the Board’s track record of overseeing significant value destruction and seeming indifference towards the Company’s stockholders, the true owners of the Company, we believe it has become abundantly clear that the current Board and management are not worthy stewards of our Company. We have serious concerns about whether they can be trusted to run the strategic review process, especially given their entrenchment tactics and the timing of the stated commencement of the review process, which appears to only have been undertaken in response to an unsolicited offer.
While we are open to working constructively with the Company, we do not intend to stand idly by and allow the Board and management to continue unchecked on this path of value destruction. To that end, we have nominated the following highly qualified individuals for election at the 2022 Annual Meeting:
Ms. Davidson has significant expertise in the pharmaceutical industry and currently serves as the President ofFast Scripts LLC , an early-stage medical service provider to those recovering from opioid addiction- Previously,
Ms. Davidson served in c-suite level roles at medical care providersOmnicare, Inc. andClasen Long Term Care Pharmacy . She was also the President of theMissouri-Illinois Gateway Hemophilia Association and the Vice President of the National Pharmacy Roundtable. Ms. Davidson is the Co-Manager ofSkiProp LLC and the Manager ofDavidson LLC , which both own various rental properties.
Mr. Khangsar is the Principal atSnowlion Ventures , aVancouver -based financial consulting firm, and was previously an advisor toDeloitte Touche and a Managing Director and Executive Vice President forRCI Capital Group .Mr. Khangsar has served as an executive advisor for privately-held emerging growth companies and publicly-traded corporations alike, advising on financial strategy and execution and organizational infrastructure to support governance matters, among which include Google LLC, Key, Empower Clinics Inc. andDapper Labs .Mr. Khangsar also previously served in various government roles in Canada’sOffice of the Prime Minister and the Minister of Immigration, including as Chief of Staff, and served as Honorary Counsel to the Government ofMongolia , Chair of theMulticultural Advisory Committee of British Columbia and Director and President of theCanada-India Business Council .- He also previously served on the board of directors of
Northstar Trade Finance , a financial services provider, and Planterra, a non-profit dedicated to sustainable community development through travel, and has significant experience serving in executive roles at non-profit organizations.
Mr. Kimbell has extensive experience in the healthcare industry as well as significant advisory and government experience, and he currently serves as the President ofJeffrey J. Kimbell & Associates , a client service provider to the life sciences industry.Mr. Kimbell served on PresidentGeorge W . Bush’sTransition Team Advisory Committee for the U.S. Department of Health and Human Services.- Previously, he served as Founding Partner of
Advyzom, LLC , a leading boutique consulting company specializing in highly strategic regulatory and development advice and services for the pharmaceutical and healthcare industries. Mr. Kimbell previously served as the first Executive Director of theMedical Device Manufacturers Association , one of the leading educational and advocacy association advancing the interests of innovative and entrepreneurial medical device manufacturers inthe United States .
Ms. Lockett currently serves as a Partner atLockett + Horwitz, PLC .Ms. Lockett has extensive knowledge of the capital markets and securities laws, and as a corporate and securities law attorney, she has experience representing public and private companies at various stages of development with corporate governance and securities matters, as well as advising on mergers and acquisitions, financing, and fundraising activities.Ms. Lockett currently serves on the board of directors ofAmmo, Inc. (NASDAQ: POWW).
Mr. Max has extensive experience as a c-suite level executive across a variety of industries. He currently serves as the CEO of Ascent Solar Technologies, and previously served as CEO ofAgile Space Industries, Inc. ,Rezolve, Inc. ,Venda, Inc. andWhiteLight Systems, Inc. , and as President ofPowa Technologies, Inc. Mr. Max currently serves as a director ofOrbital Assembly Corporation .Mr. Max previously served as a Managing Partner ofLa Plata Capital Partners, LLC , and as a Senior Advisor toLiiv Group , two investment-based companies.Mr. Max also previously served as Managing Director PLR Advisors, Ltd., a capital markets and technology consulting firm, and Executive Vice President ofOptiMark Technologies Inc. , a stock-trading technology developer.
Dr. Ziegler is currently the Chief Medical Officer ofPromedim Ltd. , a firm specializing in the oversight of pharmaceutical clinical trials, and also serves as the Managing Partner ofMountain Anesthesia PLLC (d/b/aPremier Healthcare Partners ).Dr. Ziegler has served as a consultant to the pharmaceutical industry since 2012 and, in that capacity, has acted as the Medical Director of many clinical trials and drug development programs for a number of pharmaceutical companies and clinical research organizations, and is also a Fellow of theAmerican Society of Anesthesiologists .Dr. Ziegler previously served on the board of directors ofLifeSci Acquisition Corp.
About
Formed in 2021, LifeSci Special Opportunities is a public investing arm of
CERTAIN INFORMATION CONCERNING THE PARTICIPANTS
LIFESCI STRONGLY ADVISES ALL STOCKHOLDERS OF THE COMPANY TO READ THE PROXY STATEMENT AND OTHER PROXY MATERIALS AS THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. SUCH PROXY MATERIALS WILL BE AVAILABLE AT NO CHARGE ON THE SEC’S WEB SITE AT HTTP://WWW.SEC.GOV. IN ADDITION, THE PARTICIPANTS IN THIS PROXY SOLICITATION WILL PROVIDE COPIES OF THE PROXY STATEMENT WITHOUT CHARGE, WHEN AVAILABLE, UPON REQUEST. REQUESTS FOR COPIES SHOULD BE DIRECTED TO THE PARTICIPANTS' PROXY SOLICITOR.
The participants in the proxy solicitation are anticipated to be LifeSci Special Opportunities,
As of the date hereof, LifeSci Special Opportunities beneficially owns 96,976 shares of common stock,
1 Represents the date one trading day prior to LifeSci Special Opportunities’ engagement with the Company becoming public.
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