By Svea Herbst-Bayliss
NEW YORK (Reuters) -Proxy advisory firm Institutional Shareholder Services urged Dynavax Technologies shareholders on Friday to reelect all its company directors instead of backing life sciences investment firm Deep Track Capital’s four nominees.
“Vote for all four management nominees,” ISS wrote in a note to clients that was seen by Reuters. “The dissident has failed to present a compelling case that change is necessary at this meeting.”
Investors will vote on June 11. Recommendations from ISS and its rivals Glass Lewis and Egan-Jones often help guide shareholders’ decisions.
Deep Track Capital is pushing on with a proxy fight and wants new directors to prioritize development of the company’s hepatitis B vaccine instead of pursuing new acquisitions.
The investment firm is Dynavax’s second largest shareholder with a nearly 15% stake. It wants Dynavax to focus exclusively on growing Heplisav, a vaccine designed to prevent the hepatitis B infection that can lead to chronic liver disease and death, into an asset that a large pharma company would want to own.
While ISS recommended against Deep Track’s nominees, it acknowledged certain challenges. “There has been a stall in momentum,” it said in a report, but noted that “the market has in no way rebuked the company’s strategy.”
Dynavax’s stock price has fallen 18% over the last 12 months.
Representatives for Dynavax and Deep Track did not immediately respond to requests for comment.
(Reporting by Svea Herbst-Bayliss; Editing by Richard Chang)
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