Velan sets the Record Straight on Progenics Pharmaceuticals' Latest Misleading Statements

ALPHARETTA, Ga., June 17, 2019 /PRNewswire/ -- Velan Capital, L.P. (together with the other participants in its solicitation, "Velan" or "we"), one of the largest stockholders of Progenics Pharmaceuticals, Inc. ("Progenics" or the "Company")(NASDAQ:PGNX), comprised of successful specialty pharmaceutical operators and financial services experts, today issued the following statement responding to certain misleading claims made by the Progenics Board of Directors (the "Board").

On June 13, 2019, the Board delivered a second letter to "fellow shareholder[s]" touting a commitment "to enhancing the value of [their] investment." Due to the Board's apparent desire to preserve the status quo and distract stockholders from the issues plaguing the Company - where minimal stock ownership in the boardroom, lackluster operational performance, endless stockholder dilution and hefty compensation are all acceptable under the current regime - the Board has elected to engage in a campaign of misinformation and scare tactics. Velan is here to set the record straight.

                   The Board's Misleading Statement                          Perspective of True Stockholder

                  ---

           "Dear Fellow Shareholder"                 Non-executive directors collectively own only ~0.06% of
                                                      Progenics common stock with Peter Crowley and Michael
                                                     Kishbauch owning ZERO shares of Progenics common stocki



                                                           The Board added insult to injury to "fellow
                                                     shareholder[s]" with its decision to dilute stockholders
                                                     in June 2019 by making a milestone payment in stock when
                                                                 it could have done so with cash



    ---

          "...Velan Capital, L.P., an                 Velan, a true fellow shareholder, is aligned with all
         investment firm, is attempting               stockholders - we will only make money if the value of
            to derail our significant                 our investment appreciates. We are not seeking control
          progress and ultimately gain                of the Board, rather we are seeking accountability for
             control of your Board."                                years of underperformance



    ---

            "The Progenics Board and                 The Board directed a failed 1404 Phase 3 trial and sat
        management team continue to make              idle for more than SIX YEARS before beginning its MIP-
           significant progress toward               1095 Phase 2 program in June 2019, after Velan's public
           enhancing the value of your                involvement. Furthermore, AZEDRA was acquired in 2013
           investment. We are working                with the majority of its pivotal trial patients already
            tirelessly to advance our                    recruited...it was not approved until July 2018
         pipeline and make a difference
           in the lives of patients."



                                                          It took more than TEN YEARS of Mr. Crowley's tenure and
                                                          TEN MONTHS from AZEDRA's FDA approval for the Company to
                                                                          treat ONE cancer patient



                                                      Progenics' stock price has declined over nearly every
                                                        relevant period against both absolute and relative
                                                     metrics. While the Board is oblivious, true stockholders
                                                     have felt the lack of progress under the incumbent Board



    ---

         "Since FDA approval of AZEDRA,               The Board deemed AZEDRA "commercialization ready" in
           Progenics has mastered this               2017. In the words of CEO Mark Baker at the time AZEDRA
            complex commercialization                 was approved, "radiopharmaceuticals, it's like baking
                    process"                          bread, right?" The management team further stated that
                                                         facility readiness, payor engagement and patient
                                                       onboarding should take "a matter of weeks" - clearly
                                                      these "masters" did not understand the complexities of
                                                     AZEDRA's launch, with cancer patients waiting more than
                                                                      TEN MONTHS to be dosed



                                                       Compare this to two other cancer radiotherapeutics,
                                                      XOFIGO and LUTATHERA, with patient dosing occurring in
                                                       the same quarters as their respective FDA approvals



    ---

         "Both of these accomplishments              Since AZEDRA's FDA approval in July 2018, the Company's
             [FDA approval and first                                 stock has declined 51%ii
           commercial sale of AZEDRA]
        created excellent value for you,
            our fellow shareholders."



                                                     When the Company finally dosed an AZEDRA patient, the
                                                       Board elected to pay a commercial milestone payment
                                                     issuing over 1.6 million shares of common stock instead
                                                      of using its ample cash balance, even though its stock
                                                              price was a depressed ~$4.20 per share



                                                           What tangible "excellent value" can the Board identify
                                                                      that has benefitted stockholders?



    ---

          "Novartis has invested many                Novartis bought two of the Company's competitors while
         billions of dollars to acquire                the Progenics Board sat idle for SIX YEARS. Had the
          assets in the prostate cancer               Board moved quickly on AZEDRA and MIP-1095, Progenics
            and neuroendocrine tumor                   may have already been acquired for as much as a 17x
         radiopharmaceutical spaces that              return (which is what Endocyte, Inc. generated for its
         are quite similar to Progenics'                     stockholders in approximately one year)
                   products."



                                                      It is likely not a coincidence that Novartis chose to
                                                      invest in assets managed or overseen by others rather
                                                     than those under the direction (or lack thereof) of this
                                                                              Board



    ---

        "Our three directors targeted by              Although Mr. Baker deserves to be targeted, Velan has
            Velan bring indispensable                    only recommended stockholders vote against two
        experience, which is critical to                     directors, Messrs. Crowley and Kishbauch
        the Company's continued success"



                                                    Under the direction of Chairman Crowley, the Company's
                                                         stock price has declined 46%.iii As a supposed
                                                      financier, Mr. Crowley has mercilessly directed excess
                                                       stockholder dilution to the tune of $200+ million in
                                                     equity and approved outsized compensation for missed and
                                                      unambitious corporate goals (which could be because he
                                                             does not own any shares of common stock)



                                                    During Mr. Crowley's tenure as Chairman, Mr. Baker was
                                                       promoted to CEO and the Board has failed to provide
                                                       proper oversight and direction needed given that Mr.
                                                     Baker's prior corporate operational experience consisted
                                                     of tenures in the ferry and grain industries. The Board
                                                     should have used its "indispensable experience" to guide
                                                      Mr. Baker rather than permitting value destruction and
                                                                 missed opportunities to persist



                                                     Mr. Kishbauch has served as a director of three other
                                                        public companies in the past ten years whose stock
                                                     prices declined by 76% (Achillion Pharmaceuticals), 88%
                                                         (Catabasis Pharmaceuticals) and 97% (TetraLogic
                                                      Pharmaceuticals), respectively, during his tenure. In
                                                      addition, OraPharma, the company he founded, was sold
                                                      for $7.41 per share while its IPO price was $18.00 per
                                                         share, nearly a 60% decline. The Board's letter
                                                      purposefully omitted this fact, instead highlighting a
                                                         "63 percent premium" to a depressed stock price



    ---

         "Mr. Kishbauch is Chair of the             While Mr. Kishbauch has served as Chair of the Nominating
            Nominating and Corporate                     and Governance Committee, the Board has opposed
          Governance Committee. In this               initiatives to expand stockholder rights and deprived
        role, he has continued his track             stockholders of the opportunity to elect representatives
          record of espousing best-in-                         of their choosing, including by (i)
         class governance practices and
          welcoming shareholder input"

                                                     recommending against a stockholder proposal in 2018 to
                                                     expand proxy access (a proposal ISS supported) and (ii)
                                                          invalidating Velan's nomination of candidates



                                                    Velan's attempts to engage with the Company were rebuffed
                                                      until we nominated a slate of directors...how is that
                                                                  "welcoming shareholder input?"



    ---

Your vote at the 2019 Annual Meeting, scheduled to be held on July 11, 2019, should reflect your view on the performance of the Board, particularly Messrs. Crowley and Kishbauch, whom we believe are most responsible for the lack of accountability and poor corporate governance practices at Progenics, as Chairman of the Board and Chairman of the Nominating and Corporate Governance Committee, respectively, and together who represent the sole members of the Compensation Committee.

The Board touts the independent nature of six of its directors - we agree Messrs. Crowley and Kishbauch are independent...of stockholders given their complete lack of ownership of common stock. We believe there is a clear misalignment of interests between Messrs. Crowley and Kishbauch and the Company's stockholders - the true owners of Progenics.

Under the direction of Messrs. Crowley and Kishbauch, the Company has destroyed significant stockholder value, squandered its pipeline potential and failed the needs of cancer patients. If meaningful change does not occur, stockholder value will continue to be destroyed and cancer patients will continue to be neglected. We urge stockholders to follow our call to action by voting AGAINST the re-election of Messrs. Crowley and Kishbauch on the GREEN proxy card.

It is time for accountability and stockholder alignment at Progenics - Velan urges all stockholders to vote on the GREEN proxy card today!

Investor contacts:
Deepak Sarpangal
(415) 677-7050
campaign@velancapital.com
www.savePGNX.com

Okapi Partners LLC
Pat McHugh / Jason Alexander
(212) 297-0720
info@okapipartners.com

(i) Excludes shares underlying exercisable options held by non-executive directors.
(ii) Calculated from July 30, 2018 to June 14, 2019.
(iii) Calculated from February 4, 2009 to June 14, 2019.

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SOURCE Velan Capital, L.P.