Forest Laboratories, Inc. (NYSE: FRX) (“Forest”) today announced
that members of its Board of Directors are sending a letter to all
Forest shareholders in connection with the Company’s Annual Meeting
on August 15, 2012. The letter underscores Forest’s proven track
record of successfully developing and launching new drugs and
details why Carl Icahn’s vague ideas for improving the company are
illogical and flawed.
Forest’s Board of Directors continues to recommend that
shareholders vote for all 10 of the Company’s highly qualified
director nominees on the WHITE proxy card.
For information about Forest’s 2012 Annual Meeting of
Shareholders, please visit: www.FRX2012annualmeeting.com.
The text of the July 27th letter follows:
July 27, 2012
Dear Fellow Forest Shareholders,
On behalf of the Forest Board of Directors, we wanted to write
to you regarding an important decision you will soon face. Forest
Laboratories’ August 15th Annual Meeting of shareholders is quickly
approaching, and Carl Icahn is again attempting to replace four of
your directors with his own hand-picked representatives. We believe
his nominees are far less qualified than your current directors and
would bring no additional relevant experience that would help build
value for you. In fact, we believe they would work to promote an
agenda that could destroy the value potential of Forest’s next
generation of products.
FOREST HAS A TANGIBLE TRACK RECORD OF
SUCCESS DEVELOPING AND LAUNCHING NEW PRODUCTS
Forest’s Board and management team have worked for many years to
build one of the most promising product pipelines in the industry,
receiving seven product approvals in seven different indications in
just the past five years. Notably, just last week, we received FDA
approval for aclidinium, which we will market under the brand name
Tudorza. We expect to receive approval for linaclotide in September
of 2012, and we are planning to file NDAs for levomilnacipran and
cariprazine later this calendar year. In short, Forest has built a
track record of new product development that compares favorably to
its peers, as well as many of the largest global pharma
companies.1
Forest’s Board and management team also have a proven track
record of success launching, marketing and supporting products
throughout their lifecycles, delivering four “blockbuster” drugs
with over $1 billion in sales with Lexapro, Namenda, Celexa and
Benicar – a remarkable achievement for any pharma company,
particularly one of Forest’s size.
ICAHN’S IDEAS DEFY LOGIC AND HIS NOMINEES
LACK THE EXPERIENCE TO CONTRIBUTE TO FOREST
Now, just as Forest is on the verge of unlocking the value of
its “Next Nine” products as well as four high-value life cycle
programs, Carl Icahn advances as his central thesis the notion
that the Company should slash the resources necessary to
successfully launch its products by hundreds of millions of
dollars.2 Cutting back on Forest’s successful and proven
marketing force at this time would be akin to letting up on the
throttle of a jet engine just as the plane is ready to take off.
Not only does this defy logic, but we know of no one else in the
investment community who supports such a reckless approach.
ICAHN’S APPROACH IS SIMPLY NOT CREDIBLE AND
IS MUCH MORE LIKELY TO DESTROY SHAREHOLDER VALUE THAN CREATE
IT
Icahn has not offered a viable plan or even a constructive idea
to build value for you. Instead, he has offered only vague promises
to “evaluate,” “assess” and “review” operational matters. Icahn’s
list of suggestions consists of routine judgments that all
pharmaceutical companies must make. Forest’s directors and
management team regularly “evaluate,” “assess” and “review” each of
the areas on Icahn’s list, and our track record of success in
launching products, advancing our pipeline and delivering on our
commitments to build shareholder value demonstrate that we have the
right team, with the right qualifications, to maximize the value of
the Company’s next generation of products.
YOUR HIGHLY QUALIFIED BOARD HAS THE RIGHT
MIX OF OPERATING EXPERIENCE AND PHARMACEUTICAL INDUSTRY KNOWLEDGE
TO GET THE JOB DONE
In contrast to Icahn’s nominees, the four directors he wants to
replace – Dan L. Goldwasser, Kenneth E. Goodman, Lawrence S.
Olanoff, M.D., Ph.D. and Lester B. Salans, M.D. – have, together
with their other board members and our management team, performed a
critical role in the successful launch of multiple products in
rapid succession. This includes helping to guide the Company as it
successfully launched three blockbuster
products (Lexapro, Benicar, Namenda) during 2002-2004 and
five products (Bystolic, Savella,
Teflaro, Daliresp and Viibryd) from 2008-2011.
Your directors have been critical to the development and
successful execution of our strategy. Collectively, we have years
of experience skillfully acquiring new products, overseeing their
clinical development, obtaining regulatory approval with
appropriate labeling and timely marketing multiple products to
achieve high sales levels. Among many other accomplishments, this
board and management team:
- Have experience identifying and developing
a deep pipeline of product candidates;
- Have built and managed complex partnerships
that are critical to Forest’s success, such as those Forest has
with Almirall, Gedeon Richter, Ironwood, Merck KGaA, Pierre Fabre,
and Takeda;
- Have worked directly with the FDA to obtain
multiple product approvals within a short time frame;
- Have developed and implemented marketing
programs and managed sales forces to promote numerous
pharmaceutical products launched within a short time frame;
- Have managed a pipeline through the
launches of multiple new products and related life cycle extensions
in rapid succession; and
- Have successfully launched multiple
blockbuster products, including four in the last ten years.
Shareholders should ask themselves, what complementary skills or
experience would Icahn’s nominees bring that the Forest Board does
not already have? The answer is NONE.
Moreover, we believe they bring conflicts and entanglements that
would compromise their ability to act objectively in the interests
of all shareholders.
Most importantly for the future of your investment, each of your
directors is right now playing a critical role in the successful
launch of Forest’s next generation of products. We believe
replacing them now – at this critical juncture in the Company’s
development – to pursue the reckless notion of drastically cutting
the resources necessary for successful product launches, carries a
serious risk to your investment in Forest. In our view, the
better course is to vote for the team that has successfully carried
out multi-product launches in the past, and is in the process of
doing it again. That is the key to unlocking the value of Forest’s
next generation of products and protecting your investment in our
company.
We strongly recommend that shareholders vote the WHITE card they
have received from Forest and to vote “FOR ALL” 10 of
Forest’s nominees. Shareholders can vote by telephone, Internet or
by signing, dating and returning the Company’s WHITE proxy card.
Forest urges shareholders NOT to sign any proxy card sent to them
by the Icahn Group. Even a withhold vote for Icahn’s nominees on
Mr. Icahn’s gold proxy card will cancel any previous proxy
submitted by shareholders that voted “FOR ALL” the Company’s
nominees.
On behalf of the entire Board of Directors, we thank you for
your continued support.
Sincerely,
/s/
Howard Solomon
Chairman of the Board and Chief Executive Officer
/s/
Kenneth E. Goodman
Presiding Independent Director
/s/
Gerald M. Lieberman
Chairperson, Nominating and Governance Committee
Forward-Looking Information
Except for the historical information contained herein, this
document contains forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. These
statements involve a number of risks and uncertainties, including
the difficulty of predicting FDA approvals, the acceptance and
demand for new pharmaceutical products, the impact of competitive
products and pricing, the timely development and launch of new
products, and the risk factors listed from time to time in Forest
Laboratories’ Annual Report on Form 10-K, Quarterly Reports on Form
10-Q and any subsequent SEC filings.
Important Additional Information
Forest Laboratories, its directors, director nominees and
certain of its executive officers may be deemed to be participants
in the solicitation of proxies from Forest shareholders in
connection with the matters to be considered at Forest
Laboratories’ 2012 Annual Meeting. Forest Laboratories has filed
its definitive proxy statement (as it may be amended, the “Proxy
Statement”) with the U.S. Securities and Exchange Commission (the
“SEC”) in connection with such solicitation of proxies from Forest
shareholders. FOREST SHAREHOLDERS ARE STRONGLY ENCOURAGED TO READ
THE PROXY STATEMENT AND ACCOMPANYING PROXY CARD AS THEY CONTAIN
IMPORTANT INFORMATION. Information regarding the ownership of
Forest's directors and executive officers in Forest stock,
restricted stock and options is included in their SEC filings on
Forms 3, 4 and 5, which can be found at the Company's website
(www.frx.com) in the section "Investors." More detailed information
regarding the identity of potential participants, and their direct
or indirect interests, by security holdings or otherwise, is set
forth in the Proxy Statement and other materials to be filed with
the SEC in connection with Forest Laboratories' 2012 Annual
Meeting. Information can also be found in Forest's Annual Report on
Form 10-K for the year ended March 31, 2012, filed with the SEC on
May 25, 2012. Shareholders can obtain the Proxy Statement, any
amendments or supplements to the Proxy Statement and other
documents filed by Forest Laboratories with the SEC for no charge
at the SEC's website at www.sec.gov. Copies are also available at
no charge at Forest Laboratories' website at www.frx.com or by
writing to Forest Laboratories at 909 Third Avenue, New York, New
York 10022.
If you have any questions, require
assistance with voting your WHITE proxy card,
or need additional copies of the proxy
materials, please contact:
MacKenzie Partners, Inc.
105 Madison Avenue
New York, NY 10016
frxproxy@mackenziepartners.com
(212) 929-5500 (Call Collect)
Or
TOLL-FREE (800) 322-2885
About Forest Laboratories
Forest Laboratories' (NYSE: FRX) longstanding global
partnerships and track record developing and marketing
pharmaceutical products in the United States have yielded its
well-established central nervous system and cardiovascular
franchises and innovations in anti-infective, respiratory,
gastrointestinal and pain management medicine. Forest’s pipeline,
the most robust in its history, includes product candidates in all
stages of development across a wide range of therapeutic areas. The
Company is headquartered in New York, NY. To learn more, visit
www.FRX.com.
1 Forest has delivered more new molecular entity approvals and
new drug application (NDA)/BLA filings over the last three years
than similarly sized companies such as Shire or Warner Chilcott,
and has had the same number or more than much larger companies like
GlaxoSmithKline, AstraZeneca, Merck and Eli Lilly.
2 See Icahn Shareholder Presentation, dated July 17, 2012 at
slide 47.
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