Gasthalter & Co. represents Rubric Capital Management as it sends a Nov. 10 letter to the board of Chimerix Inc., expressing a lack of confidence in the strategic direction of the biopharmaceutical company.
RCM, which owns an 8.5 percent stake in Chimerix, says the company’s shares trade at a substantial discount to its liquidation value.
It calls for the board “to begin a winddown process and conserve cash to maximize liquidation value available to shareholders, while simultaneously exploring strategic alternatives for ONC201,” treatment for glioma patients.
RCM considers further investment in ONC201, which is likely to need an expensive phase 3 trial, “is not an appropriate course of action for a company of this size and with such an onerous cost of capital.”
Chimerix, which uses Joele Frank, Wilkinson Brimmer Katcher, does not believe liquidation is in the best interests of shareholders as it would deprive them of the significant upside potential of ONC201 and other assets.
"It would also be irresponsible to patients with this deadly disease as it would halt critical progress on ONC201 simply as a means to appease a shareholder making such demands," said Chimerix.
Gasthalter & Co. has Jonathan Gasthalter and Sam Fisher handling RCM.
Joele Frank's Chimerix team includes Nick Lamplough, Dan Moore and Tanner Kaufman.