Billionaire investor launches board fight at Athira, wants CEO replaced (updated)
30/03/2022 14:51
(Adds comment from company, stock price)
By Svea Herbst-Bayliss
BOSTON, March 30 (Reuters) - Billionaire investor Richard
(Ric) Kayne is seeking two board seats at Athira Pharma
ATHA.O , arguing the biotech company needs a new chief
executive officer to successfully guide its development of
treatments for Alzheimer's and other neurodegenerative diseases.
Kayne, who founded private equity investment firm Kayne
Anderson Capital Advisors, told Athira shareholders that he
nominated himself and George Bickerstaff, a former chief
financial officer of Novartis Pharma AG, to the company's eight-
person board, according to a letter seen by Reuters that was
sent to shareholders on Wednesday.
He told the company about his plans last month.
The company's stock price climbed 2.15% in early trading as
the broader market was off modestly.
"Simply put, Dr. Litton is not the right CEO for Athira,"
Kayne wrote, noting that Litton has little operational, clinical
trial or scientific experience and spent most of his career in
business development roles.
Mark Litton became CEO last year, succeeding Leen Kawas.
Kawas oversaw the development of ATH-1017, an agent designed to
regenerate brain tissue, and the company's public listing in
2020.
Kayne, who owns 4.8% of Athira's stock, says the stock price
has tumbled 26% since Litton took over day-to-day operations in
June and investors generally don't have faith in Litton's
credentials or his ability to tell the company's story.
He is similarly critical of Athira's board, arguing the
directors had little relevant expertise until recently when new
members with biotech experience were added after he started
pushing for changes. Kayne said the company offered him a board
seat earlier this month but noted the "offer was quickly
rescinded with little explanation."
A company representative said three independent directors
joined in the last year and that the board already has the
skills Kayne and Bickerstaff would add. She noted that board
members have spoken with Kayne "numerous" times in an effort to
find a "collaborative path" but that Kayne "rejected our
attempts to find common ground."
"Adding me and George Bickerstaff will help the Board
restore credibility and refocus on what really matters:
attracting the best management team and giving ATH-1017 the best
chance of success," Kayne wrote.
(Reporting by Svea Herbst-Bayliss; Editing by Cynthia Osterman
and Andrea Ricci)
((svea.herbst@thomsonreuters.com; +617 856 4331; Reuters
Messaging: svea.herbst.thomsonreuters.com@reuters.net))