A Medical Device Daily
A dissident shareholder and self-described "proxy organizer" of Artes Medical (San Diego), Dr. H. Michael Shack issued a statement, calling it a "necessary response to most recent events" the company reported, specifically about the dismissal of most of the company's staff and the mention of possible liquidation.
"We continue to forge forward and attempt to meet with the board of directors of Artes Medical to resurrect shareholder value," Shack said. "Our game plan remains the same: protect and preserve the status quo, reorganize, and become profitable. We believe that our financing strategy is a solution to keeping the company alive and that liquidation is not a viable option. We have worked diligently in the last few months to prepare Artes for a successful turnaround, by having a committed roster of new directors along with a new and highly qualified management team that is prepared to grow Artes into a profitable medical device company."
Artes, developer of the injectable filler Artefill, a treatment designed to smooth "smile-line" wrinkles, reported a profit of $865,000 last quarter, putting it far short of a projected profit in the several millions for 2008.
Artes reported in September the following list of issues facing the company: that it had filed suit against two of its founders and former executives; that it is in a proxy fight with a disenchanted shareholder (Shack); that it has received a Nasdaq delisting notice; and that it is looking at "strategic alternatives." Additionally, Shack issued a statement at that time that his group has designated William Kachioff as the "future" CFO of Artes (Medical Device Daily, Sept. 4, 2008).
"We will take all necessary measures to make sure our financing strategy and proposed path-to-profitability are heard so a restructured board can revive Artes and undo the errors of the current board and management," Shack said. "We are tired of the board's failure to act swiftly and boldly and believe that due to their own interests nothing has been done to protect the shareholders. In contrast to current management, the proxy group believes failure is not an option and most actions and statements of the current management team has caused undue pressure on Artes' share price."
He added that now is not the time for shareholders to "throw in the towel, but rather back our team and proposals so we can restart Artes Medical into a profit-generating entity."
In the statement, Shack also urged other Artes shareholders to join his proxy group "to support the only plan that places shareholders' interests first."