1. Merrimack Pharmaceuticals, Inc. (NASDAQ:MACK) ("Merrimack" or the "Company") today announced its third quarter 2020 financial results for the period ended September 30, 2020.

    "We are pleased that both Ipsen Pharmaceuticals and Elevation Oncology continue to enroll patients in separate clinical stage programs which could result in milestone payments to Merrimack," said Gary Crocker, Chairman of Merrimack's Board of Directors. "We remain focused on conserving cash and reduction of our operating expenses to ensure that we have sufficient financial resources to capture future potential milestone payments from Ipsen and Elevation."

    Third Quarter 2020 Financial Results

    Merrimack reported net loss of $1.0 million for the third quarter ended September…

    Merrimack Pharmaceuticals, Inc. (NASDAQ:MACK) ("Merrimack" or the "Company") today announced its third quarter 2020 financial results for the period ended September 30, 2020.

    "We are pleased that both Ipsen Pharmaceuticals and Elevation Oncology continue to enroll patients in separate clinical stage programs which could result in milestone payments to Merrimack," said Gary Crocker, Chairman of Merrimack's Board of Directors. "We remain focused on conserving cash and reduction of our operating expenses to ensure that we have sufficient financial resources to capture future potential milestone payments from Ipsen and Elevation."

    Third Quarter 2020 Financial Results

    Merrimack reported net loss of $1.0 million for the third quarter ended September 30, 2020, or $0.08 per basic share, compared to a net loss of $0.7 million, or $0.05 per basic share, for the same period in 2019.

    No gain on sale of assets was recognized for the third quarter ended September 30, 2020 compared to $3.5 million for the same period in 2019.

    General and administrative expenses for the third quarter ended September 30, 2020 were $1.0 million, compared to $4.3 million for the same period in 2019.

    As of September 30, 2020, Merrimack had cash and cash equivalents and investments of $15.8 million, compared to $16.6 million as of December 31, 2019.

    As of September 30, 2020, Merrimack had 13.4 million shares of common stock outstanding.

    Updates on Programs Underlying Potential Milestone Payments

    Ipsen

    - On October 22, 2020 Ipsen released its third quarter financial results. As part of that update, Ipsen reported that it is continuing to study ONIVYDE® in Phase III clinical trials in first line pancreatic ductal adenocarcinoma and in second line small cell lung cancer.

    Elevation Oncology

    - On October 26, 2020 Elevation Oncology announced the presentation of preclinical data on its HER3 program. This announcement included confirmation that Elevation's phase II CRESTONE study is currently enrolling patients.

    About Merrimack

    Merrimack Pharmaceuticals, Inc. is a biopharmaceutical company based in Cambridge, Massachusetts that is entitled to receive up to $450.0 million in contingent milestone payments related to its sale of ONIVYDE® to Ipsen S.A. in April 2017. These milestone payments would be payable by Ipsen upon approval by the U.S. Food and Drug Administration ("FDA") of ONIVYDE® for certain additional clinical indications. ONIVYDE® is already approved by the FDA in combination with fluorouracil (5-FU) and leucovorin (LV) for the treatment of patients with metastatic adenocarcinoma of the pancreas after disease progression following gemcitabine-based therapy. This existing approval is unrelated to any future potential milestone payments. Merrimack's agreement with Ipsen does not require Ipsen to provide Merrimack with any information on the progress of ONIVYDE® clinical trials that is not publicly available. Merrimack is also entitled to receive up to $54.5 million in contingent milestone payments related to its sale of anti-HER3 programs to Elevation Oncology (formerly 14ner Oncology, Inc.) in July 2019. The Company is seeking potential acquirers for its remaining preclinical assets.

    Forward Looking Statements

    To the extent that statements contained in this press release are not descriptions of historical facts, they are forward-looking statements reflecting the current beliefs and expectations of management made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements include any statements about Merrimack's strategy, future operations, future financial position, future revenues and future expectations and plans and prospects for Merrimack, and any other statements containing the words "anticipate," "believe," "estimate," "expect," "intend," "may," "plan," "predict," "project," "target," "potential," "will," "would," "could," "should," "continue" and similar expressions. In this press release, Merrimack's forward-looking statements include, among others, statements about Merrimack's plans to seek to divest its preclinical and clinical assets, Merrimack's rights to receive payments related to certain milestone events or whether such milestones will be achieved, if at all, the sufficiency of Merrimack's cash resources and Merrimack's strategic plan, including any potential distribution of additional cash. Such forward-looking statements involve substantial risks and uncertainties that could cause Merrimack's future results, performance or achievements to differ significantly from those expressed or implied by the forward-looking statements. Such risks and uncertainties include, among others: Positive information about pre-clinical and early stage clinical trial results does not ensure that later stage or larger scale clinical trials will be successful. For example, Onivyde® may not demonstrate promising therapeutic effect or appropriate safety profiles in current or later stage or larger scale clinical trials as a result of known or as yet unanticipated side effects. The results achieved in later stage trials may not be sufficient to meet applicable regulatory standards or to justify further development. Problems or delays may arise prior to the initiation of planned clinical trials, during clinical trials or in the course of developing, testing or manufacturing that could lead Ipsen and Elevation Oncology and their partners and collaborators to fail to initiate or to discontinue development. Even if later stage clinical trials are successful, unexpected concerns may arise from subsequent analysis of data or from additional data. Obstacles may arise or issues may be identified in connection with review of clinical data with regulatory authorities. Regulatory authorities may disagree with Ipsen and Elevation Oncology's view of the data or require additional data or information or additional studies. In addition, the planned timing of initiation and completion of clinical trials based upon Onivyde® and the anti-HER Program are subject to the ability of each of Ipsen and Elevation Oncology, respectively, to enroll patients, enter into agreements with clinical trial sites and investigators, and overcome technical hurdles and other issues related to the conduct of the trials for which each of them is responsible. Additionally, each of Ipsen and Elevation Oncology are subject to the risk that they may not successfully commercialize these development programs. Merrimack is also subject to the risk that it may not have funding sufficient for its foreseeable and unforeseeable operating expenses and capital expenditure requirements. In addition, press releases and other public statements by Ipsen and Elevation Oncology may contain forward-looking statements. Merrimack undertakes no obligation to update or revise any forward-looking statements. Forward-looking statements should not be relied upon as representing Merrimack's views as of any date subsequent to the date hereof. For a further description of the risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to Merrimack's business in general, see the "Risk Factors" section of Merrimack's Annual Report on Form 10-K filed with the SEC on March 12, 2020, any subsequent quarterly report on Form 10-Q filed by Merrimack and the other reports Merrimack files with the Securities and Exchange Commission.

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  2. Merrimack Pharmaceuticals, Inc. (NASDAQ:MACK) [("Merrimack" or the "Company")] today announced its first quarter 2020 financial results for the period ended March 31, 2020.

    "We are pleased to report that we have significantly reduced our operating expenses and also sold certain of our remaining intellectual property assets during the first quarter of 2020," said Gary Crocker, Chairman of Merrimack's Board of Directors. "As a result of reduced general and administrative costs and the proceeds from the previously announced asset sale we reported a profit of $249,000 for the first quarter. We are currently focused on making further reductions to legal, accounting and management consulting expenses which we plan to realize during the second half…

    Merrimack Pharmaceuticals, Inc. (NASDAQ:MACK) [("Merrimack" or the "Company")] today announced its first quarter 2020 financial results for the period ended March 31, 2020.

    "We are pleased to report that we have significantly reduced our operating expenses and also sold certain of our remaining intellectual property assets during the first quarter of 2020," said Gary Crocker, Chairman of Merrimack's Board of Directors. "As a result of reduced general and administrative costs and the proceeds from the previously announced asset sale we reported a profit of $249,000 for the first quarter. We are currently focused on making further reductions to legal, accounting and management consulting expenses which we plan to realize during the second half of 2020."

    First Quarter 2020 Financial Results

    Merrimack reported net income of $0.25 million for the first quarter ended March 31, 2020, or $0.02 per basic and diluted share on a fully diluted basis, compared to a net loss of $10.5 million, or $0.78 per basic and diluted share on a fully diluted basis, for the same period in 2019.

    Merrimack reported a gain on the sale of assets for the first quarter ended March 31, 2020 of $2.1 million, attributable to the sale of certain of our preclinical nanoliposome programs.

    No research and development expenses were recognized for the first quarter ended March 31, 2020 compared to $6.4 million for the same period in 2019.

    General and administrative expenses for the first quarter ended March 31, 2020 were $1.9 million, compared to $3.7 million for the same period in 2019.

    As of March 31, 2020, Merrimack had cash and cash equivalents and investments of $18.0 million, compared to $16.6 million as of December 31, 2019.

    As of March 31, 2020, Merrimack had 13.4 million shares of common stock outstanding.

    About Merrimack

    Merrimack Pharmaceuticals, Inc. is a biopharmaceutical company based in Cambridge, Massachusetts that is entitled to receive up to $450.0 million in contingent milestone payments related to its sale of ONIVYDE® to Ipsen S.A. in April 2017. Merrimack's agreement with Ipsen does not require Ipsen to provide Merrimack with any information on the progress of ONIVYDE clinical trials that is not publicly available. Merrimack is also entitled to receive up to $54.5 million in contingent milestone payments related to its sale of anti-HER3 programs to Elevation Oncology (formerly 14ner Oncology, Inc.) in July 2019. The Company is seeking potential acquirers for its remaining preclinical and clinical assets.

    Forward Looking Statements

    To the extent that statements contained in this press release are not descriptions of historical facts, they are forward-looking statements reflecting the current beliefs and expectations of management made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements include any statements about Merrimack's strategy, future operations, future financial position, future revenues and future expectations and plans and prospects for Merrimack, and any other statements containing the words "anticipate," "believe," "estimate," "expect," "intend," "may," "plan," "predict," "project," "target," "potential," "will," "would," "could," "should," "continue" and similar expressions. In this press release, Merrimack's forward-looking statements include, among others, statements about Merrimack's plans to seek to divest its preclinical and clinical assets, Merrimack's rights to receive payments related to certain milestone events or whether such milestones will be achieved, if at all, the sufficiency of Merrimack's cash resources and Merrimack's strategic plan, including any potential distribution of additional cash. Such forward-looking statements involve substantial risks and uncertainties that could cause Merrimack's future results, performance or achievements to differ significantly from those expressed or implied by the forward-looking statements. Such risks and uncertainties include, among others, expectations for achievement of contractual milestones and the availability of funding sufficient for Merrimack's foreseeable and unforeseeable operating expenses and capital expenditure requirements. Merrimack undertakes no obligation to update or revise any forward-looking statements. Forward-looking statements should not be relied upon as representing Merrimack's views as of any date subsequent to the date hereof. For a further description of the risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to Merrimack's business in general, see the "Risk Factors" section of Merrimack's Quarterly Report on Form 10-K filed with the SEC on March 12, 2020 and the other reports Merrimack files with the Securities and Exchange Commission.

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  3. Merrimack Pharmaceuticals, Inc. (NASDAQ:MACK) [("Merrimack" or the "Company")] today announced receipt of $2.25 million in connection with the closing of a transaction in which the Company sold certain assets related to its preclinical nanoliposome programs to Celator Pharmaceuticals, Inc. Merrimack will not receive any further contingent consideration or royalties as a result of this transaction.

    Under the terms of the agreement for the transaction, Celator, in addition to paying the base purchase price of $2.25 million, reimbursed the Merrimack for certain specified expenses and assumed certain liabilities with respect to the acquired assets. Further, under the agreement, the Company assigned to Celator the previously disclosed intellectual…

    Merrimack Pharmaceuticals, Inc. (NASDAQ:MACK) [("Merrimack" or the "Company")] today announced receipt of $2.25 million in connection with the closing of a transaction in which the Company sold certain assets related to its preclinical nanoliposome programs to Celator Pharmaceuticals, Inc. Merrimack will not receive any further contingent consideration or royalties as a result of this transaction.

    Under the terms of the agreement for the transaction, Celator, in addition to paying the base purchase price of $2.25 million, reimbursed the Merrimack for certain specified expenses and assumed certain liabilities with respect to the acquired assets. Further, under the agreement, the Company assigned to Celator the previously disclosed intellectual property license agreement among the Company and Ipsen S.A pursuant to which Ipsen granted the Company licenses to certain patents, and Celator also granted the Company an exclusive license to certain specified know-how and patents related to specific nano-liposome projects which remain in the Merrimack portfolio.

    Completion of this transaction is a continuation of Merrimack's strategy of extending its cash runway into 2027 and preserving its ability to capture the potential $450 million of remaining ONIVYDE-related contingent milestone payments resulting from its 2017 asset sale to Ipsen as well as the potential $54.5 million of remaining contingent milestone payments resulting from its 2019 sale of certain programs to Elevation Oncology, Inc. (formerly known as 14ner Oncology, Inc.).

    "This asset sale transaction reflects our ongoing strategic focus on both the monetization of our remaining preclinical assets and the further reduction of our operating expenses," said Gary Crocker, Chairman of Merrimack's Board of Directors. "Ipsen recently publicly announced that ONIVYDE is in Phase 3 clinical trials in two additional indications which we believe could, if successful, support the attainment of certain milestones. The proceeds from the Celator transaction provide an additional operational buffer in the event of any potential unanticipated contingencies, and enhance our ability to focus on our top priority, which is to preserve our ability to collect milestones and to maximize returns to shareholders. As opportunities arise we will continue to look to distribute excess cash not essential to our minimal operations."

    About Merrimack

    Merrimack Pharmaceuticals, Inc. is a biopharmaceutical company based in Cambridge, Massachusetts that is entitled to receive up to $450.0 million in contingent milestone payments related to its sale of ONIVYDE® to Ipsen S.A. in April 2017 and up to $54.5 million in contingent milestone payments related to its sale of anti-HER3 programs to Elevation Oncology (formerly 14ner Oncology, Inc.) in July 2019. The Company is seeking potential acquirers for its remaining preclinical and clinical assets.

    Forward Looking Statements

    To the extent that statements contained in this press release are not descriptions of historical facts, they are forward-looking statements reflecting the current beliefs and expectations of management made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements include any statements about Merrimack's strategy, future operations, future financial position, future revenues and future expectations and plans and prospects for Merrimack, and any other statements containing the words "anticipate," "believe," "estimate," "expect," "intend," "may," "plan," "predict," "project," "target," "potential," "will," "would," "could," "should," "continue" and similar expressions. In this press release, Merrimack's forward-looking statements include, among others, statements about Merrimack's plans to seek to divest its preclinical and clinical assets, Merrimack's rights to receive payments related to certain milestone events or whether such milestones will be achieved, if at all, the sufficiency of Merrimack's cash resources and Merrimack's strategic plan, including any potential distribution of additional cash. Such forward-looking statements involve substantial risks and uncertainties that could cause Merrimack's future results, performance or achievements to differ significantly from those expressed or implied by the forward-looking statements. Such risks and uncertainties include, among others, expectations for achievement of contractual milestones and the availability of funding sufficient for Merrimack's foreseeable and unforeseeable operating expenses and capital expenditure requirements. Merrimack undertakes no obligation to update or revise any forward-looking statements. Forward-looking statements should not be relied upon as representing Merrimack's views as of any date subsequent to the date hereof. For a further description of the risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to Merrimack's business in general, see the "Risk Factors" section of Merrimack's Quarterly Report on Form 10-K filed with the SEC on March 12, 2020 and the other reports Merrimack files with the Securities and Exchange Commission.

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  4. Merrimack Pharmaceuticals, Inc. (NASDAQ:MACK) (the "Company" or "Merrimack"), announced today that its Board of Directors (the "Board") has adopted a Section 382 net operating loss rights plan (the "Plan") and declared a dividend distribution of one Preferred Share Purchase Right on each outstanding share of Company common stock. The Plan is designed to protect the Company's ability to use its valuable net operating loss ("NOL") carryforwards and certain other valuable tax attributes.

    "Preservation of our NOL carryforwards is a key element of our strategic plan and may be used to offset potential corporate tax payments related to future milestones in order to maximize shareholder value," said Gary Crocker, CEO of the Company. "This Plan is…

    Merrimack Pharmaceuticals, Inc. (NASDAQ:MACK) (the "Company" or "Merrimack"), announced today that its Board of Directors (the "Board") has adopted a Section 382 net operating loss rights plan (the "Plan") and declared a dividend distribution of one Preferred Share Purchase Right on each outstanding share of Company common stock. The Plan is designed to protect the Company's ability to use its valuable net operating loss ("NOL") carryforwards and certain other valuable tax attributes.

    "Preservation of our NOL carryforwards is a key element of our strategic plan and may be used to offset potential corporate tax payments related to future milestones in order to maximize shareholder value," said Gary Crocker, CEO of the Company. "This Plan is similar to rights plans adopted by other public companies and is designed to diminish the risk that Merrimack's existing NOL carryforwards and other tax attributes become limited under Section 382 of the Internal Revenue Code."

    Details of the Plan and the related rights will be contained in a Current Report on Form 8-K that the Company will file with the Securities and Exchange Commission.

    About Merrimack Pharmaceuticals, Inc.

    Merrimack Pharmaceuticals, Inc. is a biopharmaceutical company based in Cambridge, Massachusetts that is entitled to receive up to $450.0 million in contingent milestone payments related to its sale of ONIVYDE® to Ipsen S.A. in April 2017 and up to $54.5 million in contingent milestone payments related to its sale of anti-HER3 programs to 14ner Oncology, Inc. in July 2019. The Company is seeking potential acquirers for its remaining preclinical and clinical assets.

    To the extent that statements contained in this press release are not descriptions of historical facts, they are forward-looking statements reflecting the current beliefs and expectations of management made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements include any statements about Merrimack's strategy, future operations, future financial position, future revenues and future expectations and plans and prospects for Merrimack, and any other statements containing the words "anticipate," "believe," "estimate," "expect," "intend," "may," "plan," "predict," "project," "target," "potential," "will," "would," "could," "should," "continue" and similar expressions. In this press release, such statements include, but are not limited to the potential value of future net operating loss carryforwards of the Company.

    Factors that could cause actual results to differ materially from those contemplated in the Company's forward-looking statements include, among others: (a) the difficulty of determining all of the facts relevant to Section 382 of the Internal Revenue Code; (b) unreported buying and selling activity by the Company's stockholders; and (c) the adoption of the Plan may not prevent one or more of the Company's stockholders from, notwithstanding the dilution to such stockholder's interest, engaging in buying and selling activity that may have an adverse impact on the Company's tax attributes.

    The Company undertakes no obligation to update or revise any forward-looking statements. Forward-looking statements should not be relied upon as representing Merrimack's views as of any date subsequent to the date hereof. For a further description of the risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to Merrimack's business in general, see the "Risk Factors" section of Merrimack's Quarterly Report on Form 10-Q filed with the SEC on November 12, 2019 and the other reports Merrimack files with the SEC.

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  5. Merrimack Pharmaceuticals, Inc. (NASDAQ:MACK) today announced that it received a $5 million milestone payment from Ipsen, triggered by Ipsen's decision to progress the ongoing multi-part clinical trial evaluating ONIVYDE in patients with small-cell lung cancer into the second randomized portion of the trial focused on efficacy assessment. As a result of this milestone payment, Merrimack's Board of Directors has authorized and declared a special cash dividend of $6.7 million on the Company's common stock (the "Special Dividend").

    The Special Dividend is payable on December 23, 2019 to stockholders of record as of the close of business on December 16, 2019. The ex-dividend date for the Special Dividend will be December 13, 2019, the first business…

    Merrimack Pharmaceuticals, Inc. (NASDAQ:MACK) today announced that it received a $5 million milestone payment from Ipsen, triggered by Ipsen's decision to progress the ongoing multi-part clinical trial evaluating ONIVYDE in patients with small-cell lung cancer into the second randomized portion of the trial focused on efficacy assessment. As a result of this milestone payment, Merrimack's Board of Directors has authorized and declared a special cash dividend of $6.7 million on the Company's common stock (the "Special Dividend").

    The Special Dividend is payable on December 23, 2019 to stockholders of record as of the close of business on December 16, 2019. The ex-dividend date for the Special Dividend will be December 13, 2019, the first business day preceding the record date. Stockholders of record on the record date who sell their shares prior to the ex-dividend date will not receive the Special Dividend. Based on the current number of shares outstanding, the Special Dividend will be approximately $0.50 per common share; this amount may vary based on the number of outstanding shares as of the record date.

    Merrimack currently estimates that, for U.S. federal tax purposes, 100% of the Special Dividend (or approximately $0.50 per share) will likely be first treated as a return of capital to stockholders to the extent of their basis in Merrimack common stock, and then as capital gain.

    The tax treatment of the Special Dividend will be based on Merrimack's current and accumulated earnings and profits for Merrimack's 2019 fiscal year ending December 31, 2019 ("FY19"). The process of determining current and accumulated earnings and profits requires a final determination of Merrimack's financial results for FY19 and a review of certain other factors. The determination will be based in part on factors that are outside of the control of Merrimack and which cannot be ascertained at this time. Merrimack does not expect the calculation of the portion that will be treated as a taxable dividend for federal tax purposes to be finalized until after the completion of FY19. Accordingly, the portion of the Special Dividend estimated to be a taxable dividend provided in this release is based upon currently available information and is subject to change.

    The precise tax impact of the Special Dividend to specific stockholders depends upon the stockholder's individual tax situation. Stockholders are advised to consult with their personal tax advisors.

    "The progress that we have made in streamlining our operating costs is reflected in the authorization of a special dividend higher than the amount of the milestone that we have received from Ipsen," said Gary Crocker, Chairman of Merrimack's Board of Directors. "Our remaining cash balance is anticipated to support operations into 2027, when we estimate the longest-term potential Ipsen milestone may be achieved."

    About Merrimack

    Merrimack Pharmaceuticals, Inc. is a biopharmaceutical company based in Cambridge, Massachusetts that is entitled to receive up to $450.0 million in contingent milestone payments related to its sale of ONIVYDE® to Ipsen S.A. in April 2017 and up to $54.5 million in contingent milestone payments related to its sale of anti-HER3 programs to 14ner Oncology, Inc. in July 2019. The Company is seeking potential acquirers for its remaining preclinical and clinical assets.

    Forward Looking Statements

    To the extent that statements contained in this press release are not descriptions of historical facts, they are forward-looking statements reflecting the current beliefs and expectations of management made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements include any statements about Merrimack's strategy, future operations, future financial position, future revenues and future expectations and plans and prospects for Merrimack, and any other statements containing the words "anticipate," "believe," "estimate," "expect," "intend," "may," "plan," "predict," "project," "target," "potential," "will," "would," "could," "should," "continue" and similar expressions. In this press release, Merrimack's forward-looking statements include, among others, statements about the declared special cash dividend and the sufficiency of Merrimack's cash resources. Such forward-looking statements involve substantial risks and uncertainties that could cause Merrimack's future results, performance or achievements to differ significantly from those expressed or implied by the forward-looking statements. Such risks and uncertainties include, among others, expectations for achievement of contractual milestones and the availability of funding sufficient for Merrimack's foreseeable and unforeseeable operating expenses and capital expenditure requirements. Merrimack undertakes no obligation to update or revise any forward-looking statements. Forward-looking statements should not be relied upon as representing Merrimack's views as of any date subsequent to the date hereof. For a further description of the risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to Merrimack's business in general, see the "Risk Factors" section of Merrimack's Quarterly Report on Form 10-Q filed with the SEC on November 12, 2019 and the other reports Merrimack files with the Securities and Exchange Commission.

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  6. LAKEWAY, Texas, Sept. 24, 2019 /PRNewswire/ -- JFL Capital Management, LLC (together with its affiliates, "JFL Capital"), the largest stockholder of Merrimack Pharmaceuticals, Inc. ("Merrimack" or the "Company") (NASDAQ:MACK), with ownership of approximately 9.4% of the Company's outstanding shares, announced today that it has withdrawn its solicitation in connection with the Company's 2019 annual meeting of stockholders (the "Annual Meeting").

    In response to JFL Capital initiating its campaign for change at Merrimack, the Company has undergone significant changes, including multiple cash distributions and most recently appointing two stockholder representative to its Board of Directors (the "Board").  We hope the newly appointed Board members…

    LAKEWAY, Texas, Sept. 24, 2019 /PRNewswire/ -- JFL Capital Management, LLC (together with its affiliates, "JFL Capital"), the largest stockholder of Merrimack Pharmaceuticals, Inc. ("Merrimack" or the "Company") (NASDAQ:MACK), with ownership of approximately 9.4% of the Company's outstanding shares, announced today that it has withdrawn its solicitation in connection with the Company's 2019 annual meeting of stockholders (the "Annual Meeting").

    In response to JFL Capital initiating its campaign for change at Merrimack, the Company has undergone significant changes, including multiple cash distributions and most recently appointing two stockholder representative to its Board of Directors (the "Board").  We hope the newly appointed Board members will focus on cost containment, continued NOL safeguarding, and milestone payment and stockholder distribution maximization. JFL Capital is pleased to have served as the catalyst for these much needed changes, and, as a result, has determined to withdraw its slate of nominees for election at the Annual Meeting.

    JFL Capital is hopeful that the newly appointed stockholder representatives on the Board will ensure that future payments from Ipsen and 14ner Oncology are distributed to stockholders in their entirety. It is the Board's responsibility to ensure an orderly and cost effective liquidation.

    JFL Capital intends to monitor the situation closely and encourages the Board to consider further cost savings such that more cash can be returned to the Company's stockholders.

    Contacts:
    Joseph F. Lawler M.D., Ph.D.
    (512) 761-4500

    Cision View original content:http://www.prnewswire.com/news-releases/jfl-capital-ends-campaign-at-merrimack-300924657.html

    SOURCE JFL Capital Management, LLC

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  7. Company Enters into Cooperation Agreement with Newtyn Management and Western Standard

    Independent Directors Noah Levy of Newtyn and Eric Andersen of Western Standard to Be Added to Merrimack Board, Effective Immediately

    Newtyn and Western Have Agreed to Vote for Merrimack Slate of Nominees for 2019 Annual Meeting

    Merrimack Believes that JFL Capital's Plans for the Company Do Not Align with Views of Other Shareholders and Could Imperil Ability to Protect Potential Milestone Payments and NOLs

    Merrimack Pharmaceuticals (NASDAQ:MACK) (the "Company" or "Merrimack") announced today that, effective immediately, its Board of Directors has appointed Noah G. Levy, of Newtyn Management, LLC ("Newtyn") and Eric D. Andersen, of Western Standard…

    Company Enters into Cooperation Agreement with Newtyn Management and Western Standard

    Independent Directors Noah Levy of Newtyn and Eric Andersen of Western Standard to Be Added to Merrimack Board, Effective Immediately

    Newtyn and Western Have Agreed to Vote for Merrimack Slate of Nominees for 2019 Annual Meeting

    Merrimack Believes that JFL Capital's Plans for the Company Do Not Align with Views of Other Shareholders and Could Imperil Ability to Protect Potential Milestone Payments and NOLs

    Merrimack Pharmaceuticals (NASDAQ:MACK) (the "Company" or "Merrimack") announced today that, effective immediately, its Board of Directors has appointed Noah G. Levy, of Newtyn Management, LLC ("Newtyn") and Eric D. Andersen, of Western Standard, LLC ("Western") to the Board, pursuant to a cooperation agreement.

    Including Messrs. Levy and Andersen, the Board will nominate five directors for election at the 2019 Annual Meeting of Shareholders (the "2019 Annual Meeting"), which is scheduled for October 17, 2019. Mr. Levy's and Mr. Andersen's funds, Newtyn and Western, collectively represent approximately 15% of Merrimack shares outstanding, and Merrimack shares represented by all five Merrimack nominees now total approximately 23% of shares outstanding.

    Under the agreement Messrs. Levy and Andersen have agreed to waive compensation for their Board service. It also provides that the Board will form a Committee on Strategy and Expenses, chaired by Mr. Levy, that will focus on cost containment, continued NOL safeguarding and milestone payment and shareholder distribution maximization. As part of the cooperation agreement, both Newtyn and Western have agreed to vote for all five of Merrimack's nominees for election at the 2019 Annual Meeting. Newtyn's and Western's voting and other commitments under the cooperation agreement generally are evergreen with certain limited exceptions.

    These changes were reached following engagement with a significant portion of Merrimack's institutional and retail shareholders. During this process, it became clear to Merrimack that the key priorities for its shareholders – including Newtyn and Western – generally are to:

    • Do everything possible to protect the more than $500 million in potential milestone payments the Company could receive from Ipsen S.A. and 14ner Oncology;
    • Protect the approximately $200 million in NOLs to shield potential tax payments related to the potential milestones;
    • Monetize the Company's TNFR2 program, if possible, and other preclinical assets, in a cost-effective manner; and
    • Maximize asset value per share by conserving the Company's cash reserves while maintaining minimal operations and periodically examining ways to return additional capital to shareholders whenever possible.

    "We are pleased to welcome Noah and Eric to our Board and appreciate the support of two of our significant investors throughout this process," said Gary Crocker, Chairman of Merrimack's Board of Directors. "Merrimack has a carefully considered plan in place to continue our intense focus on cash management and to maximize the distribution of cash and potential milestone payments to our shareholders. Following numerous discussions with investors we feel confident that our strategy is aligned with their views."

    "As one of the Company's largest shareholders, I look forward to serving on the Board. I also look forward to serving as Chair of the planned Committee on Strategy and Expenses, a position in which I intend to work to reduce costs, minimize risk and protect all fellow shareholders," said Noah G. Levy of Newtyn.

    Added Eric D. Andersen of Western, "I appreciate the constructive engagement and open dialogue with Merrimack's Board, and with this cooperation agreement, I look forward to collaborating with other Board members to maximize value for all shareholders."

    Prior to reaching an agreement with Newtyn and Western, Merrimack also engaged extensively with JFL and its advisors in an effort to reach a constructive solution that would prevent a contested election. During these discussions, JFL communicated to the Board that its intended strategy was to use approximately $10-15 million of the Company's current cash reserves to purchase and develop a new small molecule in early stages of therapeutic development – a strategy JFL admitted could also require the Company to raise additional funds, which would dilute existing shareholders and could impair the Company's NOLs. Under JFL's plan the Company would also explore the potential issuance of a preferred security entitling holders to the potential milestone payment, assuming this was possible from a tax perspective.

    These discussions with JFL were constructive and resulted in the Company offering the fund two seats on the Board and proposing the formation of a strategic committee that would be chaired by one of the JFL nominees. Unfortunately, these discussions broke down over a few key issues, including the requirement by JFL that the strategic committee would have binding conditions placed on it preventing the committee from voting against an asset acquisition if they did not think it was in the best interest of the Company and all shareholders. Without this requirement in place, JFL would not agree to refrain from proxy fights against the Company following the 2019 Annual Meeting. Merrimack ultimately concluded this was not something that could be agreed to while preserving the Board's ability to fulfill its fiduciary duties. Further, after receiving substantial shareholder feedback, the Board concluded that a one proxy season standstill did not provide a long-term solution to the cost and distraction associated with the constant threat of a proxy fight by JFL looming over the Company and the investment of our shareholders. In order to convince JFL to accept a standstill that lasted more than just through the 2019 Annual Meeting, the Board made a reasonable and shareholder-centric proposal that any strategy proposed by the strategic committee that the Board could not accept after taking into account its fiduciary duties would be put to a vote by all shareholders. JFL was unwilling to accept this proposal.

    About Eric D. Andersen

    Mr. Andersen has been a managing member / portfolio manager at Western Standard, LLC, an investment firm, since June 2008. Prior to that, Mr. Andersen served as an analyst at Ivory Capital and JCK Partners, both investment firms, from 2006 to 2008 and 2004 to 2006, respectively; an associate in the private equity group at J.P. Morgan Partners, LLC, from 2002 to 2004; and an analyst, mergers and acquisitions, at The Blackstone Group, an investment firm, from 2000 to 2002. Mr. Andersen holds a B.A. from Dartmouth College and is a CFA Charterholder.

    About Noah G. Levy

    Mr. Levy has been a managing member and portfolio manager at Newtyn Management, LLC, an investment firm, since June 2011. Prior to that, Mr. Levy served as a senior member at Tyndall Management, an investment firm, from 2002 to 2011, and as an analyst at Goldman Sachs, an investment bank and financial services company, from 2000 to 2002. Mr. Levy holds a B.A. from Dartmouth College.

    About Merrimack

    Merrimack Pharmaceuticals, Inc. is a biopharmaceutical company based in Cambridge, Massachusetts that is entitled to receive up to $455.0 million in contingent milestone payments related to its sale of ONIVYDE® to Ipsen S.A. in April 2017 and up to $54.5 million in contingent milestone payments related to its sale of anti-HER3 programs to 14ner Oncology, Inc. in July 2019. The Company is seeking potential acquirers for its remaining preclinical and clinical assets.

    Important Additional Information

    The Company, its directors and certain of its executive officers are participants in the solicitation of proxies from the Company's shareholders in connection with the Company's 2019 Annual Meeting of Stockholders (the "2019 Annual Meeting"). The Company intends to file a definitive proxy statement and WHITE proxy card with the U.S. Securities and Exchange Commission (the "SEC") in connection with any such solicitation of proxies from the Company's shareholders. SHAREHOLDERS OF THE COMPANY ARE STRONGLY ENCOURAGED TO READ SUCH PROXY STATEMENT, ACCOMPANYING WHITE PROXY CARD AND ALL OTHER DOCUMENTS FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE AS THEY WILL CONTAIN IMPORTANT INFORMATION. The Company's preliminary proxy statement for the 2019 Annual Meeting contains information regarding the direct and indirect interest, by securities holdings or otherwise, of the Company's directors and executive officers in the Company's securities. If the holdings of the Company's securities change from the amounts provided in the Company's preliminary proxy statement for the 2019 Annual Meeting, such changes will be set forth in SEC filings on Forms 3, 4, and 5, which can be found through the Company's website at www.merrimack.com in the "Investors" section under "SEC Filings" or through the SEC's website at www.sec.gov. Information can also be found in the Company's other SEC filings, including the Company's definitive proxy statement for the 2018 Annual Meeting of Shareholders and its Annual Report on Form 10-K for the year ended December 31, 2018. 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 definitive proxy statement and other materials to be filed with the SEC in connection with the 2019 Annual Meeting. Shareholders will be able to obtain the definitive proxy statement, any amendments or supplements to the proxy statement and other 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 www.merrimack.com in the "Investors" section under "SEC Filings."

    Forward-Looking Statements

    To the extent that statements contained in this press release are not descriptions of historical facts, they are forward-looking statements reflecting the current beliefs and expectations of management made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements include any statements about Merrimack's strategy, future operations, future financial position, future revenues and future expectations and plans and prospects for Merrimack, and any other statements containing the words "anticipate," "believe," "estimate," "expect," "intend," "may," "plan," "predict," "project," "target," "potential," "will," "would," "could," "should," "continue" and similar expressions. In this press release, Merrimack's forward-looking statements include, among others, statements about the declared special cash dividend, the sufficiency of Merrimack's cash resources and Merrimack's strategic plan, including the potential distribution of additional cash. Such forward-looking statements involve substantial risks and uncertainties that could cause Merrimack's future results, performance or achievements to differ significantly from those expressed or implied by the forward-looking statements. Such risks and uncertainties include, among others, risks related to the actions of JFL Capital Management LLC and other activist stockholders, expectations for achievement of contractual milestones and the availability of funding sufficient for Merrimack's foreseeable and unforeseeable operating expenses and capital expenditure requirements. Merrimack undertakes no obligation to update or revise any forward-looking statements. Forward-looking statements should not be relied upon as representing Merrimack's views as of any date subsequent to the date hereof. For a further description of the risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to Merrimack's business in general, see the "Risk Factors" section of Merrimack's Quarterly Report on Form 10-Q filed with the SEC on July 17, 2019 and the other reports Merrimack files with the SEC.

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  8. Dividend Amount is $1.496675 per Outstanding Share of Merrimack Common Stock and Will be Paid Today, as Previously Announced

    Company Provides Update on NOL Carryforwards; No Impairment as of July 24, 2019

    Merrimack Pharmaceuticals (NASDAQ:MACK) (the "Company" or "Merrimack") announced today that the dividend amount for the previously authorized and declared $20 million special cash dividend (the "Special Dividend") announced on July 25, 2019 is $1.496675 per outstanding share of Merrimack common stock. The dividend will be paid today, September 5, 2019, as previously announced, to stockholders of record as of the close of business on August 28, 2019.

    The Company is focused on executing its carefully constructed plan to conserve cash and…

    Dividend Amount is $1.496675 per Outstanding Share of Merrimack Common Stock and Will be Paid Today, as Previously Announced

    Company Provides Update on NOL Carryforwards; No Impairment as of July 24, 2019

    Merrimack Pharmaceuticals (NASDAQ:MACK) (the "Company" or "Merrimack") announced today that the dividend amount for the previously authorized and declared $20 million special cash dividend (the "Special Dividend") announced on July 25, 2019 is $1.496675 per outstanding share of Merrimack common stock. The dividend will be paid today, September 5, 2019, as previously announced, to stockholders of record as of the close of business on August 28, 2019.

    The Company is focused on executing its carefully constructed plan to conserve cash and maximize value for shareholders, including distributing all of the more than $500 million in potential milestone payments the Company is eligible to receive, net of any taxes owed. The Special Dividend is consistent with implementing the Company's strategic plan and, as opportunities arise, Merrimack will continue to look to distribute any excess cash deemed not essential to the Company's minimal operations required to preserve its ability to capture all remaining potential milestones.

    "Consistent with the Board of Directors' strategic review and Merrimack's prior communications, we are committed to maximizing the distribution of cash and milestone payments to our shareholders going forward," said Gary Crocker, Chairman of Merrimack's Board of Directors. "This dividend is part and parcel of that steadfast commitment."

    U.S. Federal Tax Treatment of the Special Dividend

    Merrimack currently estimates that, for U.S. federal tax purposes, 100% of the Special Dividend (or approximately $1.50 per share) will likely be first treated as a return on capital to stockholders to the extent of their basis in Merrimack common stock, and then as capital gain.

    The tax treatment of the Special Dividend will be based on Merrimack's current and accumulated earnings and profits for Merrimack's 2019 fiscal year ending December 31, 2019 ("FY19"). The process of determining current and accumulated earnings and profits requires a final determination of Merrimack's financial results for FY19 and a review of certain other factors. The determination will be based in part on factors that are outside of the control of Merrimack and which cannot be ascertained at this time. Merrimack does not expect the calculation of the portion that will be treated as a taxable dividend for federal tax purposes to be finalized until after the completion of FY19. Accordingly, the portion of the Special Dividend estimated to be a taxable dividend provided in this release is based upon currently available information and is subject to change.

    The precise tax impact of the Special Dividend to specific stockholders depends upon the stockholder's individual tax situation. Stockholders are advised to consult with their personal tax advisors.

    No NOL Impairment as of July 24, 2019

    The Company engaged a leading global tax advisor to complete an evaluation of ownership changes through July 24, 2019 to refresh a recent study and assess whether utilization of the Company's net operating loss carryforwards ("NOLs") would be subject to an annual limitation under Section 382 of the Internal Revenue Code. As a result of this analysis, the Company believes it can utilize all of its existing tax net operating loss carryforwards. Any future impairment of the NOLs caused by a transaction that triggers an ownership change or use of the NOLs for other purposes could reduce these returns to shareholders. Merrimack is committed to monitoring the status of the Company's NOLs and refreshing its Section 382 study as needed on a periodic basis to prevent any future impairments in order to maximize potential future distributions to shareholders.

    Merrimack's Board has consistently been focused on the value of the Company's NOLs. The NOLs were fully incorporated into the recent strategic review and it was determined by the Company that the best use of the NOLs would be to shield potential tax payments related to the milestones in order to maximize distributions to shareholders.

    About Merrimack

    Merrimack Pharmaceuticals, Inc. is a biopharmaceutical company based in Cambridge, Massachusetts that is entitled to receive up to $455.0 million in contingent milestone payments related to its sale of ONIVYDE® to Ipsen S.A. in April 2017 and up to $54.5 million in contingent milestone payments related to its sale of anti-HER3 programs to 14ner Oncology, Inc. in July 2019. The Company is seeking potential acquirers for its remaining preclinical and clinical assets.

    Important Additional Information

    The Company, its directors and certain of its executive officers are participants in the solicitation of proxies from the Company's shareholders in connection with the Company's 2019 Annual Meeting of Stockholders (the "2019 Annual Meeting"). The Company intends to file a definitive proxy statement and WHITE proxy card with the U.S. Securities and Exchange Commission (the "SEC") in connection with any such solicitation of proxies from the Company's shareholders. SHAREHOLDERS OF THE COMPANY ARE STRONGLY ENCOURAGED TO READ SUCH PROXY STATEMENT, ACCOMPANYING WHITE PROXY CARD AND ALL OTHER DOCUMENTS FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE AS THEY WILL CONTAIN IMPORTANT INFORMATION. The Company's preliminary proxy statement for the 2019 Annual Meeting contains information regarding the direct and indirect interest, by securities holdings or otherwise, of the Company's directors and executive officers in the Company's securities. If the holdings of the Company's securities change from the amounts provided in the Company's preliminary proxy statement for the 2019 Annual Meeting, such changes will be set forth in SEC filings on Forms 3, 4, and 5, which can be found through the Company's website at www.merrimack.com in the "Investors" section under "SEC Filings" or through the SEC's website at www.sec.gov. Information can also be found in the Company's other SEC filings, including the Company's definitive proxy statement for the 2018 Annual Meeting of Shareholders and its Annual Report on Form 10-K for the year ended December 31, 2018. 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 definitive proxy statement and other materials to be filed with the SEC in connection with the 2019 Annual Meeting. Shareholders will be able to obtain the definitive proxy statement, any amendments or supplements to the proxy statement and other 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 www.merrimack.com in the "Investors" section under "SEC Filings."

    Forward-Looking Statements

    To the extent that statements contained in this press release are not descriptions of historical facts, they are forward-looking statements reflecting the current beliefs and expectations of management made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements include any statements about Merrimack's strategy, future operations, future financial position, future revenues and future expectations and plans and prospects for Merrimack, and any other statements containing the words "anticipate," "believe," "estimate," "expect," "intend," "may," "plan," "predict," "project," "target," "potential," "will," "would," "could," "should," "continue" and similar expressions. In this press release, Merrimack's forward-looking statements include, among others, statements about the declared special cash dividend, the sufficiency of Merrimack's cash resources and Merrimack's strategic plan, including the potential distribution of additional cash. Such forward-looking statements involve substantial risks and uncertainties that could cause Merrimack's future results, performance or achievements to differ significantly from those expressed or implied by the forward-looking statements. Such risks and uncertainties include, among others, risks related to the actions of JFL Capital Management LLC and other activist stockholders, expectations for achievement of contractual milestones and the availability of funding sufficient for Merrimack's foreseeable and unforeseeable operating expenses and capital expenditure requirements. Merrimack undertakes no obligation to update or revise any forward-looking statements. Forward-looking statements should not be relied upon as representing Merrimack's views as of any date subsequent to the date hereof. For a further description of the risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to Merrimack's business in general, see the "Risk Factors" section of Merrimack's Quarterly Report on Form 10-Q filed with the SEC on July 17, 2019 and the other reports Merrimack files with the SEC.

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  9. Company's Board has Taken Crucial Actions to Maximize Shareholder Value and Preserve More than $500 Million in Potential Future Milestone Payments

    Merrimack's Current Plan Follows Comprehensive Strategic Review Conducted with Leading Healthcare Financial Advisory Firm and Provides Best Pathway for Distributing Milestone Payments to Shareholders

    Activist Hedge Fund JFL Capital Management has Launched an Unnecessary and Costly Proxy Contest to Replace the Entire Board – Effectively Seeking to Acquire Your Company Without Paying a Control Premium

    JFL Admits it Has No Plan for the Company – Other than Potentially Pursuing Risky Transactions and Conducting a Redundant Strategic Process that Could Deplete the Company's Cash and Imperil Milestone

    Company's Board has Taken Crucial Actions to Maximize Shareholder Value and Preserve More than $500 Million in Potential Future Milestone Payments

    Merrimack's Current Plan Follows Comprehensive Strategic Review Conducted with Leading Healthcare Financial Advisory Firm and Provides Best Pathway for Distributing Milestone Payments to Shareholders

    Activist Hedge Fund JFL Capital Management has Launched an Unnecessary and Costly Proxy Contest to Replace the Entire Board – Effectively Seeking to Acquire Your Company Without Paying a Control Premium

    JFL Admits it Has No Plan for the Company – Other than Potentially Pursuing Risky Transactions and Conducting a Redundant Strategic Process that Could Deplete the Company's Cash and Imperil Milestone Payments and NOLs

    The Board of Directors of Merrimack Pharmaceuticals, Inc. (NASDAQ:MACK) (the "Company" or "Merrimack") today issued a letter to shareholders in connection with the Company's upcoming 2019 Annual Meeting of Shareholders (the "2019 Annual Meeting"), which is scheduled to be held on October 17, 2019.

    This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20190826005355/en/

    Merrimack's Stock Has Outperformed Benchmark Indexes Since Strategic Review Announcement - Source: Bloomberg – Closing Prices from 11/6/18 to 8/23/19 (Graphic: Business Wire)

    Merrimack's Stock Has Outperformed Benchmark Indexes Since Strategic Review Announcement - Source: Bloomberg – Closing Prices from 11/6/18 to 8/23/19 (Graphic: Business Wire)

    The full text of the letter follows:

    August 26, 2019

    Dear Fellow Shareholders,

    As we approach the 2019 Annual Meeting, you face an important decision that will significantly impact the future of your investment in Merrimack. You will be asked to choose between two extremely different options for the Company:

    ✓Elect the nominees who have been put forth by a Board that has taken critical and decisive actions to put in place a carefully constructed plan with the sole goal of maximizing value for you, the shareholders, including a public commitment to distribute to you all of the more than $500 million in potential milestone payments the Company receives, after any taxes owed, or

    ✗Put your investment at significant risk by handing complete control of the Board and the Company to a slate nominated by an activist investor, JFL Capital Management ("JFL"), that has admitted it has no plan for the company, but has put forth "ideas worth exploring" that have already been thoroughly evaluated, are not feasible and/or could increase expenses and dilute the value of milestone rights and other payments for shareholders. In notable contrast to Merrimack, JFL has made no commitment to distribute potential milestone payments or excess cash to shareholders.

    MERRIMACK'S CURRENT BOARD HAS LISTENED TO INVESTORS AND TAKEN DECISIVE ACTION TO MAXIMIZE SHAREHOLDER VALUE

    Recent steps the Board has taken that were directly responsive to shareholder feedback include:

    • Announced on May 30, 2019, the conclusion of the Company's extensive review of strategic alternatives and the implementation of a series of measures reflecting the input of shareholders – including JFL – and designed to extend Merrimack's cash runway into 2027 in order to preserve the ability to capture the potential remaining milestones from its pancreatic cancer therapeutic ONIVYDE® resulting from its 2017 asset sale to Ipsen S.A.
    • As part of this process, the Company and its financial advisor, a leading healthcare industry bank, MTS Health Partners, L.P., contacted more than 100 potential companies regarding transaction opportunities – ranging from reverse mergers with private companies to an outright sale of Merrimack. Unfortunately, none of these potential transaction partners offered sufficient near-term value for Merrimack shareholders. Furthermore, none of these potential partners were able or willing to assume responsibility for capturing and distributing the potential long-term ONIVYDE milestones to the Company's pre-transaction shareholders.
    • Executed an asset purchase agreement with 14ner Oncology, Inc., to sell the Company's anti-Her3 monoclonal antibody programs, MM-121 and MM-111, for up to $58.0 million in total consideration, consisting of $3.5 million in upfront cash consideration and up to $54.5 million in contingent milestone payments.
    • Strengthened the Company's balance sheet through the sale of its equity position in Silver Creek Pharmaceuticals, Inc. for $7.8 million announced on May 10, 2019, the sale of laboratory equipment resulting in approximately $1.4 million in cash and the retirement of outstanding debt.
    • Discontinued discovery efforts on Merrimack's remaining preclinical programs, MM-201 and MM-401.
    • Reduced the Company's workforce by 100 percent since the initiation of the strategic review, including the Company's entire senior management. The Company currently has no full-time employees and has engaged experienced consultants to manage day-to-day operations.
    • Announced an anticipated reduction in the size of the Board from seven to four.
    • Announced on July 25, 2019, that its Board of Directors authorized and declared a special cash dividend above guidance of $20 million to holders of the Company's common stock.

    Since the announcement of the Company's restructuring and strategic process on November 7, 2018 Merrimack's stock price has increased by approximately 55 percent – reflecting the overall positive reception by shareholders of the significant steps Merrimack has taken.

    THE COMPANY HAS A CAREFULLY CONSTRUCTED AND CONSIDERED PLAN IN PLACE TO CONSERVE CASH AND POTENTIALLY DELIVER MORE THAN $500 MILLION TO SHAREHOLDERS OVER TIME

    As a result of actions taken by the Board, Merrimack is now set up to maintain only minimal operations while protecting the Company's milestone and asset transaction payments. It is important to note that:

    • Merrimack is entitled to receive up to an aggregate of $450.0 million in potential regulatory-based milestones from Ipsen S.A., as well as up to approximately $54.5 million in potential milestone payments from 14ner Oncology, Inc. Merrimack has implemented a series of measures designed to extend its cash runway into 2027 and preserve its ability to capture these milestones.
    • Securing these payments is contingent on numerous stipulations and nuanced deal terms that have informed the decision-making process of Merrimack and its advisors, all of which were guided by feedback received from shareholders, including JFL. As Merrimack engaged with shareholders extensively before and during the strategic review process, they, including JFL, stressed to the Company the importance of preserving the ability to capture and distribute these milestone payments.
    • Merrimack's Board has consistently been focused on thevalue of the Company's NOLs. TheNOLs were fully incorporated into the recent strategic review and it was determined by the Company and its advisors that the best use of the NOLs would be to shield potential tax payments related to the milestones in order to maximize the return to shareholders. Any use of the NOLs for other purposes – including a "strategic transaction" involving the NOLs as suggested by JFL – could reduce these returns to shareholders.
    • The value of the NOLs was previously reviewed in 2017 and Merrimack has no reason to believe that there is any recent impairment. The Company has explained these factors to JFL on multiple occasions – including as recently as last week – and unfortunately, they are significantly misrepresenting this issue.
    • Merrimack currently holds approximately $20 million in cash – an amount the Company and its advisors determined is necessary to maintain the Company's minimal operations as a public company, enabling it to secure and distribute the milestone and asset transaction payments while maintaining a tradable security as requested by shareholders, including JFL. Any other plan or product development would require using up this cash, jeopardizing the milestones and/or raising new equity capital and diluting existing shareholders. As opportunities arise, Merrimack will look to distribute any excess cash not essential to its minimal operations.
    • The Company is now running as leanly as possible and JFL's focus on "Board fees"1 is a canard – these expenditures are modest and represent the bare minimum needed to keep the Company eligible to capture the milestone payments.
    • In the event the milestone payments are secured before the $20 million has been used, the Board has publicly committed to distributing any surplus funds directly to shareholders net of taxes.
    • The Company is urgently focused on monetizing its remaining clinical and preclinical assets – and, given their extensive knowledge of the Company and its strategic review, the three current directors who are being re-nominated are best positioned to assist in this process before the assets depreciate – a process which may be delayed by this unnecessary proxy contest.

    JFL ADMITS IT HAS NO PLAN FOR THE COMPANY – AND THE IDEAS IT DOES OFFER HAVE ALREADY BEEN THOROUGHLY EVALUATED, ARE NOT FEASIBLE AND/OR WOULD IMPERIL THE POTENTIAL MILESTONE PAYMENTS AND WASTE CASH

    Although it is seeking to replace the entire Merrimack Board of Directors, JFL has admitted it has no plan for the Company – and several of the few "everything in between" ideas they do offer would jeopardize the Company's milestone payments or spend the Company's cash on a redundant process to evaluate options that have already been exhaustively explored. Notably, JFL has at no time committed to distributing the over $500 million in potential milestone payments to you, the shareholders.

    Consider the following:

    • JFL has made it clear it has no plan for the Company – but has stated the belief that "If elected to the Board, our candidates intend to actively pursue measures to utilize the Company's cash and take advantage of its NOL carryforwards, including by evaluating potential strategic transactions."
    • In its recent letter,2 JFL is essentially proposing re-running the costly six-month long strategic process the Company and its financial advisor MTS Health Partners already conducted. JFL did toss out a few ideas for the Company – but they simply don't make sense:
      • "Going Dark" and "reducing operating costs" – Merrimack already has zero employees and is running at the bare minimum level of operations necessary to secure the milestone payments and protect shareholder liquidity. The Company thoroughly evaluated this option and concluded that it was not a desirable outcome for its shareholders – and in fact JFL was strongly against this "going dark" or delisting option during the strategic review.
      • "Pursuing a reverse merger" – Merrimack considered this possibility as part of its strategic review process – but ultimately there was no proposal made that would offer more value to shareholders than the Company's current structure. Ironically, when JFL was consulted on this option during the strategic review, they were strongly against it.
      • A "transaction that maximizes the utility" of the NOLs – As previously stated, any available NOLs will already be used to maximize the return to shareholders and any significant transaction could impair the NOLs or otherwise make them unavailable to maximize shareholder returns in the event of milestone payments.
      • A "restructuring" that would separate the potential milestone payments – Merrimack also evaluated this pathway thoroughly and concluded it was not possible under the agreement with Ipsen, including because there would not be sufficient information provided under the agreement to enable the company to register tradable CVRs with the SEC and because of the requirement in most circumstances for Ipsen consent.
      • "Running a thorough sales process for the potential milestone payments from Ipsen" – Again, Merrimack had these discussions with multiple entities that buy royalty and revenue streams; but did not receive any bids that fairly valued the milestones or would have provided a premium for shareholders.
    • In short, all that JFL is offering you, the shareholders, is an opaque black box - while Merrimack has a thoughtfully considered and value-creating plan to reap the potential of over $500 million in potential milestone payments and distribute them to you.

    JFL HAS CHOSEN TO RUN AN UNNECESSARY AND COSTLY PROXY CONTEST THAT IS PUTTING YOUR INVESTMENT AT RISK – AND ITS NOMINEES ARE NOT THE RIGHT CHOICE FOR MERRIMACK

    Disappointingly, JFL has chosen to pursue an expensive proxy fight at a critical time for Merrimack, despite the Company having previously taken action on all of the addressable concerns JFL expressed. Merrimack on multiple occasions tried to reach a resolution to avoid a proxy contest, and Merrimack's board remains open to a resolution with JFL that permits the Company to continue executing on its plan to maximize value for all shareholders, while providing JFL the opportunity to have input on the composition of the Board at a level commensurate with the size of its ownership stake in the Company.

    Unfortunately, JFL's response to our attempts at a constructive settlement to date has been that they were uninterested in any outcome besides being handed control of the Company – even though they were unwilling to share any plans or ideas for what actions they believe the Company should take.

    Consider the following:

    • Since April 2018, Merrimack has engaged extensively with JFL and taken into account its input and suggestions. In fact, the Company's former director and CEO and other Merrimack representatives have had approximately 26 in-person meetings, calls and email/letter exchanges with JFL in the past 16 months.
    • On July 24, 2019 Merrimack offered JFL a board seat for one of its nominees, which is in line with JFL's ownership stake, in order to avoid an expensive proxy contest – JFL declined the offer outright on July 29, 2019. The Company's advisors then reached out again on August 15, 2019 to see if there were additional creative solutions that could yield a settlement, at which point it was made clear through JFL's counsel that the fund was uninterested in any settlement that did not give them clear control of Merrimack's Board. The Company spoke to Dr. Lawler directly on August 21, 2019, and he would not offer any ideas or sense of his plan for the Company.
    • The Company does not believe JFL's nominees have the right experience or skill sets to add value to the Merrimack Board, and election of these nominees may imperil the potential milestone payments exceeding $500 million that under the Company's plan would go directly to shareholders.
    • Notably, only one of the four JFL nominees has any public board experience – a prerequisite we believe is especially important given the complexities and nuanced nature of the Company's current situation and how carefully its strategy must be navigated in order to realize the potential value Merrimack is positioned to realize over time.

    MERRIMACK'S NOMINEES ARE FULLY ALIGNED WITH ALL SHAREHOLDERS' BEST INTERESTS AND POSSESS THE EXPERIENCE NECESSARY TO PROTECT SHAREHOLDERS' INVESTMENTS

    • Merrimack's nominees collectively have many decades of director and executive leadership experience in public and private companies across healthcare, including in the biotechnology and pharmaceutical industries.
    • During their tenures on the Board, Merrimack nominees Gary L. Crocker, Ulrik B. Nielsen, Ph.D. and Russell T. Ray have implemented decisive actions with the sole purpose of maximizing value for all Merrimack shareholders.
    • These nominees also have deep knowledge of the Company's assets, existing partnerships in the pharmaceutical sector, and the best ways to monetize the remaining assets and ensure milestone payments from previous asset sales are realized.
    • Merrimack nominee Ana Radeljevic's extensive biotechnology and pharmaceutical industry experience in strategic planning, business development and corporate finance makes her a uniquely qualified candidate who can bring fresh insights to the Board.
    • Merrimack's nominees want to protect shareholders' investment, specifically by collecting the Company's milestone and asset transaction payments, while JFL risks losing these payments through an unnecessary, expensive proxy contest.

    Sincerely,

    The Board of Directors of Merrimack Pharmaceuticals

    About Merrimack

    Merrimack Pharmaceuticals, Inc. is a biopharmaceutical company based in Cambridge, Massachusetts that is entitled to receive up to $455.0 million in contingent milestone payments related to its sale of ONIVYDE® to Ipsen S.A. in April 2017 and up to $54.5 million in contingent milestone payments related to its sale of anti-HER3 programs to 14ner Oncology, Inc. in July 2019. The Company is seeking potential acquirers for its remaining preclinical and clinical assets.

    If you have any questions or require any assistance with respect to voting your shares, please contact the Company's proxy solicitor at the contact listed below:

    MORROW

    SODALI

    509 Madison Avenue, Suite 1608

    New York, NY 10022

    Stockholders Call Toll Free: (800) 662-5200

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    Important Additional Information

    The Company, its directors and certain of its executive officers are participants in the solicitation of proxies from the Company's shareholders in connection with the Company's 2019 Annual Meeting. The Company intends to file a definitive proxy statement and WHITE proxy card with the U.S. Securities and Exchange Commission (the "SEC") in connection with any such solicitation of proxies from the Company's shareholders. SHAREHOLDERS OF THE COMPANY ARE STRONGLY ENCOURAGED TO READ SUCH PROXY STATEMENT, ACCOMPANYING WHITE PROXY CARD AND ALL OTHER DOCUMENTS FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE AS THEY WILL CONTAIN IMPORTANT INFORMATION. The Company's preliminary proxy statement for the 2019 Annual Meeting contains information regarding the direct and indirect interest, by securities holdings or otherwise, of the Company's directors and executive officers in the Company's securities. If the holdings of the Company's securities change from the amounts provided in the Company's preliminary proxy statement for the 2019 Annual Meeting, such changes will be set forth in SEC filings on Forms 3, 4, and 5, which can be found through the Company's website at www.merrimack.com in the "Investors" section under "SEC Filings" or through the SEC's website at www.sec.gov. Information can also be found in the Company's other SEC filings, including the Company's definitive proxy statement for the 2018 Annual Meeting of Shareholders and its Annual Report on Form 10-K for the year ended December 31, 2018. 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 definitive proxy statement and other materials to be filed with the SEC in connection with the 2019 Annual Meeting. Shareholders will be able to obtain the definitive proxy statement, any amendments or supplements to the proxy statement and other 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 www.merrimack.com in the "Investors" section under "SEC Filings."

    Forward-Looking Statements

    To the extent that statements contained in this letter are not descriptions of historical facts, they are forward-looking statements reflecting the current beliefs and expectations of management made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements include any statements about Merrimack's strategy, future operations, future financial position, future revenues and future expectations and plans and prospects for Merrimack, and any other statements containing the words "anticipate," "believe," "estimate," "expect," "intend," "may," "plan," "predict," "project," "target," "potential," "will," "would," "could," "should," "continue" and similar expressions. In this letter, Merrimack's forward-looking statements include, among others, statements about the declared special cash dividend, the sufficiency of Merrimack's cash resources and the anticipated proxy contest by JFL Capital Management LLC and the other participants in its solicitation. Such forward-looking statements involve substantial risks and uncertainties that could cause Merrimack's future results, performance or achievements to differ significantly from those expressed or implied by the forward-looking statements. Such risks and uncertainties include, among others, risks related to the actions of JFL Capital Management LLC and other activist stockholders, expectations for achievement of contractual milestones and the availability of funding sufficient for Merrimack's foreseeable and unforeseeable operating expenses and capital expenditure requirements. Merrimack undertakes no obligation to update or revise any forward-looking statements. Forward-looking statements should not be relied upon as representing Merrimack's views as of any date subsequent to the date hereof. For a further description of the risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to Merrimack's business in general, see the "Risk Factors" section of Merrimack's Quarterly Report on Form 10-Q filed with the SEC on July 17, 2019 and the other reports Merrimack files with the SEC.

    1 8/19/19 JFL Capital Management Preliminary Proxy Statement

    2 8/22/19 JFL Capital Issues Letter to Fellow Merrimack Stockholders

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