Leading Independent Proxy Advisory Firm ISS Recommends XenoPort Stockholders Vote FOR ALL XenoPort Director Nominees

By Business Wire,  May 30, 2014, 08:30:00 AM EDT


Recommends Stockholders "Do Not Vote" For Any of the Clinton Nominees

SANTA CLARA, Calif.--(BUSINESS WIRE)-- XenoPort, Inc. (Nasdaq:XNPT) today announced that Institutional Shareholder Services (ISS), a leading independent proxy advisory firm, has recommended that XenoPort stockholders vote "FOR ALL" of XenoPort's director nominees on the WHITE proxy card at the Company's Annual Meeting of Stockholders to be held on June 11, 2014. In supporting XenoPort's entire slate of director nominees, ISS recommends that stockholders "do not vote" for any of the three nominees proposed by Clinton Relational Opportunity Master Fund, L.P. and its affiliates (Clinton). ISS also recommends XenoPort stockholders vote "FOR" the approval of XenoPort, Inc. 2014 Equity Incentive Plan, vote "FOR" the approval, on an advisory basis, the compensation of XenoPort's named executive officers, and vote "FOR" the ratification of the selection by the audit committee of the board of directors of Ernst & Young LLP as XenoPort's independent registered public accounting firm for the fiscal year ending December 31, 2014.

In its May 29, 2014 report1, ISS stated:

  • "The dissident has not made a compelling case for the need for change at the board level."

ISS recognized the Company's commercialization strategy for HORIZANT® (gabapentin enacarbil) Extended-Release Tablets, stating:

  • "the company's strategy to measure the uptake on a marketing program which truly promoted the product appears justified. Moreover, the company's decision to leverage $40 million and 50 metric tons of active ingredient acquired as part of settlement, implement state-of-the-art promotional tools, personally promote and focus marketing efforts in 40 territories, appears to be gaining traction. Using just 40 sales reps - compared to GSK's 300 reps - that called on 10% of the potential market the company has achieved the following results: a 24% increase in national prescribed tablets, a 64% increase in XP territories prescribed tablets, and a 630% increase in tablets prescribed per sales rep."
  • "the board's reasons for terminating the licensing agreement with GSK, reacquiring the rights to Horizant, and re-launching the drug in a measured manner, to verify its potential appear justified by the early results of that re-launch. Given the company is less than a year into the re-launch, it appears too early to conclude a value maximizing decision would not include the steps being currently undertaken at the company."
  • "management's contention that ‘now may be the worst time to abandon Horizant commercialization' - given that the heavy lifting of the initial investment in the commercial operation has been completed, the investments in marketing initiatives and programs are largely committed, and the positive trajectory of actual sales will likely enhance the value of a potential partnership or future divestiture of Horizant - appears to have merit. So too do the facts that Horizant could generate meaningful revenue to fund further XP23829 development, and that diverting funding from Horizant to XP23829 will not accelerate XP829's development."

ISS also recognized the steps XenoPort is taking to develop XP23829, a potential treatment for psoriasis and/or relapsing forms of multiple sclerosis (MS):

  • "we find no evidence to support the dissident claim that XP829's development is being neglected, capital starved, or that company's efforts to maximize the value of Horizant have come at the expense of the development of XP829. To the contrary, the strategy management has chosen to move forward in psoriasis appears the quickest pathway towards value creation for this asset and is echoed in analyst comments."

Commenting on the ISS report, XenoPort issued the following statement:

  • We are pleased that ISS supports the election of ALL of XenoPort's highly qualified and experienced director nominees and all of XenoPort's proposals. The recommendation of this leading, independent proxy advisory firm reinforces our belief that XenoPort has the right Board and the right strategy to maximize the value of XenoPort's assets and build stockholder value.

To follow the ISS recommendation, XenoPort's stockholders should vote on the WHITE proxy card "FOR ALL" of XenoPort's nominees: Ronald W. Barrett, Ph.D., Jeryl L. Hilleman and Wendell Wierenga, Ph.D. The XenoPort Board of Directors also urges stockholders to vote "FOR" Proposals 2 through 4 and 9 through 14 and "AGAINST" Clinton Proposals 5 through 8.

XenoPort stockholders are reminded that their vote is important, no matter how many or how few sharesthey own.

Forward-Looking Statements

This communication contains "forward-looking" statements, including, without limitation, all statements related to the potential value of XenoPort's assets and XenoPort's ability to build stockholder value, including all statements related to the commercial, revenue and value opportunity for HORIZANT and the suitability of XP23829 as a potential treatment for psoriasis or relapsing forms of MS; XenoPort's current strategy for advancing the XP23829 clinical development program; potential partnering efforts for XP23829 and/or HORIZANT; and other statements that are not historical facts. Any statements contained in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Words such as "belief," "could," "plan," "potential," "will," and similar expressions are intended to identify forward-looking statements. These forward-looking statements are based upon XenoPort's current expectations. Forward-looking statements involve risks and uncertainties. XenoPort's actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of these risks and uncertainties, which include, without limitation: risks related to XenoPort's lack of commercialization experience and its ability to successfully market and sell HORIZANT, including XenoPort's ability to maintain sales, marketing, distribution, supply chain and other sufficient capabilities to sell HORIZANT; XenoPort's dependence on the success of its strategies for HORIZANT commercialization, promotion and distribution, as well as its ability to successfully execute on these activities and to comply with applicable laws, regulations and regulatory requirements; the competitive environment for and the degree of market acceptance of HORIZANT; obtaining appropriate pricing and reimbursement for HORIZANT in an increasingly challenging environment; the difficulty and uncertainty of pharmaceutical product development and the uncertain results and timing of clinical trials and other studies, including the risk that success in preclinical testing and early clinical trials does not ensure that later clinical trials will be successful; XenoPort's ability to successfully advance XP23829 development and to conduct or initiate clinical trials in the anticipated timeframes, or at all; the uncertainty of the FDA's review process and other regulatory requirements, including the risk that FDA action, including with respect to the investigational new drug application for XP23829, would delay or prevent the initiation of future clinical trials of XP23829; XenoPort's need for and the availability of resources to develop XP23829 and to support XenoPort's operations; XenoPort's dependence on collaborative partners; the uncertain therapeutic and commercial value of HORIZANT and XP23829; as well as risks related to future opportunities and plans, including the uncertainty of future operating results. These and other risk factors are discussed under the heading "Risk Factors" in XenoPort's Quarterly Report on Form 10-Q for the quarter ended March 31, 2014, filed with the Securities and Exchange Commission on May 9, 2014. XenoPort expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company's expectations with regard thereto or any change in events, conditions or circumstances on which any such statements are based.

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

proxy@mackenziepartners.com

(212) 929-5500 (Call Collect)

Or

TOLL-FREE (800) 322-2885

Important Additional Information and Where to Find It

XenoPort, Inc., its directors and certain of its executive officers may be deemed to be participants in the solicitation of proxies from stockholders in connection with XenoPort's 2014 Annual Meeting of Stockholders. XenoPort has filed with the SEC and provided to its stockholders a definitive proxy statement and a WHITE proxy card in connection with such solicitation. XENOPORT STOCKHOLDERS ARE STRONGLY ENCOURAGED TO READ THE PROXY STATEMENT (INCLUDING ANY AMENDMENTS AND SUPPLEMENTS) AND THE ACCOMPANYING WHITE PROXY CARD, AND ANY OTHER RELEVANT DOCUMENTS WHEN THEY BECOME AVAILABLE, BECAUSE THEY CONTAIN IMPORTANT INFORMATION.

Information regarding the names of XenoPort's directors and executive officers and their respective interests in XenoPort by security holdings or otherwise is set forth in XenoPort's definitive proxy statement for the 2014 Annual Meeting of Stockholders, filed with the SEC on April 22, 2014, including Appendix B thereto.

The definitive proxy statement (and amendments or supplements thereto) and the accompanying WHITE proxy card, and any other relevant documents and other material filed by XenoPort with the SEC, are or will be available for no charge at the SEC's website at www.sec.gov and at XenoPort's investor relations website at http://investor.xenoport.com/index.cfm. Copies may also be obtained free of charge by contacting XenoPort Investor Relations by mail at 3410 Central Expressway, Santa Clara, California 95051 or by telephone at (408) 616-7200.

About XenoPort

XenoPort, Inc. is a biopharmaceutical company focused on developing and commercializing a portfolio of internally discovered product candidates for the potential treatment of neurological disorders. XenoPort is currently commercializing HORIZANT in the United States and developing its novel fumaric acid ester product candidate, XP23829, as a potential treatment for psoriasis and relapsing forms of MS. REGNITE® (gabapentin enacarbil) Extended-Release Tablets is being marketed in Japan by Astellas Pharma Inc.XenoPort's pipeline of product candidates also includes potential treatments for patients with spasticity related to spinal cord injury and Parkinson's disease. To learn more about XenoPort, please visit the Web site at www.XenoPort.com.

HORIZANT, REGNITE and XENOPORT are registered trademarks of XenoPort, Inc.

XNPT2G

1 Permission to use quotations from the ISS report was neither sought nor obtained.

Source: XenoPort, Inc.



This article appears in: News Headlines

Referenced Stocks: XNPT


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