Reiterates Meaningful Board Change Already
Underway
EMERYVILLE, Calif., Feb. 19,
2025 /PRNewswire/ -- Dynavax Technologies Corporation
(Nasdaq: DVAX) ("Dynavax" or the "Company"), a commercial-stage
biopharmaceutical company developing and commercializing innovative
vaccines, today issued a statement underscoring continued execution
momentum and commitment to driving long-term stockholder value. The
Company also confirmed that Deep Track Capital ("Deep Track") has
submitted a letter purporting to nominate four candidates to stand
for election to the Dynavax Board of Directors at the Company's
2025 Annual Meeting of Stockholders.
Track Record of Strong Financial Performance Underpinned by
Disciplined and Balanced Capital Allocation
Dynavax has been successfully executing a clear strategic plan
focused on three core priorities which is consistently delivering
strong financial results and sustainable long-term value:
- Driving strong HEPLISAV-B® growth: Dynavax
achieved record HEPLISAV-B annual revenue in 2024, reflecting 26%
growth year-over-year, positioning the Company at the upper tier of
its updated guidance range. The Company expects to achieve at least
60% total market share by 2030.
- Advancing a differentiated vaccine
pipeline: Dynavax is advancing a pipeline of
differentiated product candidates that leverage its proprietary CpG
1018® adjuvant, including its novel shingles vaccine program with
potential to disrupt the multi-billion dollar global shingles
vaccine market. The Company also recently announced a new
$30 million contract with the U.S.
Department of Defense to advance its plague vaccine program.
- Maintaining a disciplined and balanced approach to capital
allocation: With the strength of the Company's financial
profile, including its balance sheet with $714 million as of year-end 2024, Dynavax is well
positioned to continue developing pipeline assets towards
proof-of-concept, and able to actively pursue external
opportunities to expand its portfolio with strategically aligned
assets that can be rapidly developed into commercial products.
As part of the Company's disciplined capital plan, in
November 2024, Dynavax announced its
first share repurchase plan of $200
million which is expected to be executed within a period of
up to one year, $100 million of which
was executed through an accelerated share repurchase program. This
program allows the Company to return excess cash to stockholders
while preserving financial flexibility to make the required
investments to deliver future growth. Additionally, in the third
quarter of 2024, the Company discontinued its Tdap program given
study results did not meet required thresholds, which demonstrates
in action Dynavax's disciplined approach to deploying capital to
the greatest growth opportunities.
Meaningful Board Change Already Underway
Beginning in August 2024, the
Board initiated a process to identify new directors as part of its
ongoing refreshment program. As disclosed on January 27, 2025, the Board announced meaningful
changes to the composition of the Board and the Company's
governance profile, including the appointment of two highly
qualified independent directors, two current directors stepping
down at the 2025 Annual Meeting and the Board's intention to seek
stockholder approval at the 2025 Annual Meeting for the
declassification of the Board.
The Board has thoughtfully evolved as the Company has grown to
ensure the directors have a balanced mix of skillsets and
experiences that are closely tied to the Company's key priorities,
including vaccine development – R&D, marketing, commercial
operations, executive leadership and financial expertise.
Following the 2025 Annual Meeting, the Board will be comprised
of nine directors, with six of its eight independent directors
having been appointed since 2020.
Engagement with Deep Track
The Board and management team have engaged extensively with Deep
Track over many years and incorporated Deep Track's feedback into
the Company's decision making. Since the fall of 2024, Deep Track,
and in particular, its founder, David
Kroin, have become fixated on a strategy for Dynavax based
on significantly flawed financial and strategic assumptions.
Despite multiple attempts by the Board and management to find
common ground, Deep Track has only become more insistent on a value
destructive plan for Dynavax: abandoning portfolio diversification,
returning any cash needed to sustain and grow the business by
implementing an outsized share repurchase program and selling
Dynavax as a single-asset company. Deep Track's strip-mining plan
for Dynavax jeopardizes a strong platform with significant
long-term growth opportunities for a near-term payoff of a
considerably lower value.
To prosecute its strip-mining strategy, Deep Track initially
proposed three new directors – Jeffrey
Farrow, Donald Santel and
Brett Erkman, a Deep Track
representative. The Board's Nominating and Corporate Governance
Committee interviewed each of the three candidates and determined,
after consultation with the full Board, that only one, Mr. Santel,
would be additive to the Board relative to the existing directors
and the other independent candidates the Board was already
separately considering as part of its ongoing refreshment process.
In order to avoid the distraction and cost of a potential proxy
contest, the Board offered multiple highly reasonable settlement
proposals that provided meaningful Board refreshment without
compromising the Company's long-term prospects. Unfortunately, Deep
Track has been insistent on obtaining the ability to "control" the
Board without paying a control premium and expanded its list of
demands throughout the negotiation process:
- The Board initially proposed a settlement that included the
appointments of two independent directors, one of whom was
Mr. Santel, and one of the Board's current directors stepping
down. Mr. Kroin rejected this and demanded that any settlement must
include, Mr. Erkman, and that Deep Track must have the opportunity
to gain majority "control" of the Board by 2026. Dynavax's Board
was told that independent candidates proposed by the Board "don't
count" toward Deep Track's demand for control.
- Notwithstanding Mr. Kroin's alarming focus on gaining control
of the Board by 2026 without paying other stockholders a control
premium, the Board revised its settlement proposal to include the
appointment of a third mutually agreed independent candidate and
three current directors retiring by the 2026 Annual Meeting. Deep
Track summarily rejected this proposal, steadfast in its insistence
that it have the opportunity to take control of the Board by
2026.
- Given Deep Track's rejection of the revised settlement
proposal, the Company moved forward with its planned Board and
governance changes as announced on January
27, 2025. Subsequent to this announcement, the Board was
still willing to reach a resolution and again offered for Mr.
Santel to join the Board in the context of settlement. Deep Track
was completely unresponsive for three weeks, and instead of
engaging with the Company, decided to add a fourth candidate to its
slate and submit a nomination notice in furtherance of its
distracting and value-destructive campaign.
While the Board believes this proxy contest is unreasonable and
disregards multiple constructive settlement offers by the Board,
Dynavax remains committed to constructive and reasonable engagement
with Deep Track, while ensuring that the best interests of all
stockholders – not only those of Mr. Kroin and his fund – are
protected and represented.
The Board will review Deep Track's materials and, if
appropriate, present its formal recommendation regarding director
nominations in its proxy statement, which will be filed with the
U.S. Securities and Exchange Commission and mailed to all
stockholders eligible to vote at the 2025 Annual Meeting, which has
not yet been scheduled. Dynavax stockholders are not required to
take any action at this time.
Goldman Sachs & Co. LLC is serving as financial advisor to
Dynavax and Cooley LLP is serving as legal counsel.
WHAT IS HEPLISAV-B? HEPLISAV-B is a shot given to
adults 18 years of age and older to help prevent infection caused
by the hepatitis B virus.
HEPLISAV-B is usually given in the arm muscle. HEPLISAV-B is
given in 2 doses, 1 month apart, by a healthcare provider.
IMPORTANT SAFETY INFORMATION If you have a history
of severe allergic reaction after a previous dose of any hepatitis
B vaccine, or to any ingredient of HEPLISAV-B, including yeast, do
not take HEPLISAV-B.
HEPLISAV-B must be given by a medical professional, who will
monitor you afterwards, to check for allergic reaction.
If you are immunocompromised, or receiving immunosuppressant
therapy, you may have less of an immune response to
HEPLISAV-B.
Some people have hepatitis B infection without being aware of it
or showing any symptoms. If you already have hepatitis B present in
your body, HEPLISAV-B may not prevent hepatitis B infection.
The most common side effects include pain at the injection site,
tiredness, and headache.
HEPLISAV-B was not studied in pregnant or nursing women. Tell
your provider if you are pregnant or plan to become pregnant or are
breast feeding.
Vaccination with HEPLISAV-B may not protect all individuals.
Talk to your healthcare provider to determine if HEPLISAV-B is
right for you.
Please see full Prescribing Information
About Dynavax
Dynavax is a commercial-stage biopharmaceutical company
developing and commercializing innovative vaccines to help protect
the world against infectious diseases. The Company has two
commercial products, HEPLISAV-B® vaccine [Hepatitis B Vaccine
(Recombinant), Adjuvanted], which is approved in the U.S., the
European Union and the United
Kingdom for the prevention of infection caused by all known
subtypes of hepatitis B virus in adults 18 years of age and older,
and CpG 1018® adjuvant, currently used in HEPLISAV-B and multiple
adjuvanted COVID-19 vaccines. For more information about our
marketed products and development pipeline, visit
www.dynavax.com.
Forward-Looking Statements
This press release contains "forward-looking" statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, which are subject to a number of risks and uncertainties.
All statements that are not historical facts are forward-looking
statements. Forward-looking statements can generally be identified
by the use of words such as "anticipate," "believe," "continue,"
"could," "estimate," "expect," "forecast," "intend," "will," "may,"
"plan," "project," "potential," "seek," "should," "think,"
"toward," "will," "would" and similar expressions, or the negatives
thereof, or they may use future dates. Forward-looking statements
made in this document include statements regarding the Company's
plans to submit a declassification proposal at its 2025 Annual
Meeting, expected contributions from newly appointed directors, the
planned resignation of certain directors, expectations regarding
delivering value for our stockholders, and our future growth and
long-term performance. Actual results may differ materially from
those set forth in this press release due to the risks and
uncertainties inherent in our business, including, the risk that
circumstances surrounding or leading up to our 2025 Annual Meeting
may change, risks relating to our ability to commercialize and
supply HEPLISAV-B, and risks related to the implementation of our
long-term growth objectives, as well as other risks detailed in the
"Risk Factors" section of our Quarterly Report on Form 10-Q for the
three months ended September 30, 2024 and periodic
filings made thereafter, as well as discussions of potential risks,
uncertainties and other important factors in our other filings with
the U.S. Securities and Exchange Commission. These
forward-looking statements are made as of the date hereof, are
qualified in their entirety by this cautionary statement and we
undertake no obligation to revise or update information herein to
reflect events or circumstances in the future, even if new
information becomes available. Information
on Dynavax's website at www.dynavax.com is not
incorporated by reference in our current periodic reports with
the SEC.
Important Additional Information and Where to Find It
The Company intends to file a proxy statement, an
accompanying proxy card (which in the case of a contested
meeting would be the GOLD universal proxy card) and other relevant
documents with the SEC in connection with the solicitation of
proxies for the Company's 2025 annual meeting of stockholders (the
"2025 Annual Meeting"). STOCKHOLDERS OF THE COMPANY ARE STRONGLY
ENCOURAGED TO READ SUCH PROXY STATEMENT, ACCOMPANYING PROXY CARD
AND OTHER RELEVANT DOCUMENTS FILED WITH, OR FURNISHED TO, THE SEC
CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE AS THEY
WILL CONTAIN IMPORTANT INFORMATION. Stockholders will be able
to obtain a copy of the Company's proxy statement, accompanying
proxy card, any amendments or supplements to the proxy statement
and any other relevant documents filed by the Company with the SEC
at no charge at the SEC's website at www.sec.gov.
Copies will also be available at no charge at the Company's website
at https://investors.dynavax.com/sec-filings.
Participants in the Solicitation
This press release is neither a solicitation of a proxy or
consent nor a substitute for any proxy statement or other filings
that may be made with the SEC. Dynavax, its directors and
certain of its executive officers may be deemed to be participants
in the solicitation of proxies for the 2025 Annual Meeting.
Information about Dynavax's directors and executive officers ,
including their respective direct or indirect interests, by
security holdings or otherwise, is available in the Company's proxy
statement on Schedule 14A for its 2024 annual meeting of
stockholders, filed with the SEC on April 11, 2024
(available here). To the extent holdings of Dynavax securities
reported in the proxy statement have changed, such changes have
been or will be reflected on Statements of Change in Ownership on
Forms 3, 4 or 5 filed with the SEC. Updated information
regarding the identity of potential participants and their direct
or indirect interests, by security holdings or otherwise, will be
set forth in the Company's proxy statement for the 2025 Annual
Meeting and other relevant documents filed with the SEC in
connection with the 2025 Annual Meeting when they become available.
These documents are or, when they become available, will be
available free of charge at the SEC's website
at www.sec.gov.
For Investors:
Paul
Cox
pcox@dynavax.com
510-665-0499
or
MacKenzie Partners, Inc.
Bob Marese/John Bryan
Toll-Free: 1-800-322-2885
Email: DVAX@mackenziepartners.com
For Media:
Collected Strategies
Dan Moore / Tali Epstein
Dynavax-CS@collectedstrategies.com
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SOURCE Dynavax Technologies
