FSD Provides Corporate Update
FSD Pharma Inc. (Nasdaq: HUGE) (CSE: HUGE) (“FSD Pharma” or the “Company”) today announces the following corporate updates.
The Company continues to pursue its strategy of completing a Phase 2 clinical trial for the use of its lead compound, ultramicronized-palmitoylethanolamide (or ultramicronized PEA) (“FSD201”), to treat hospitalized COVID-19 patients in a double-blind study (the “Study”). The Company is expected to randomize 352 patients with COVID-19 infection to complete the trial. The Company believes FSD201 to be a safe drug with anti-inflammatory properties which may have the potential to address the over-exuberant inflammatory response characterized by COVID-19 infection that may lead to a cytokine storm and ultimately death. Due to various factors, primarily relating to challenges with patient recruitment due to active COVID-19 pandemic-related restrictions in hospitals, the Company may not be in a position to complete the Study prior to the end of 2021. The Company is not making any express or implied claims that its product has the ability to eliminate, cure or contain the COVID-19 (or SARS-2-Coronavirus) at this time. The Company currently has a cash balance of approximately C$22 million; the Company expects to require additional financing primarily to initiate another Phase 2 FDA approved study for its lead compound FSD 201 and to effectuate other potential in-licensing and acquisition opportunities. In addition, the Company is actively seeking appropriate potential buyers and is hopeful to finalize the sale of its non-core real estate asset in Cobourg, Ontario. The Company and its counterparty agreed to terminate the previously announced conditional sales contract for this real estate asset.
Termination of Company President For Cause:
The Company has terminated the President of the Company, Mr. Zeeshan Saeed, for cause with immediate effect. As a result of his termination, in accordance with the terms of his employment agreement, Mr. Saeed is deemed to have resigned from all other positions held with the Company and its subsidiaries, including from the Company’s board of directors.
Contested Shareholders Meeting
As previously disclosed, the Company will hold its annual meeting of shareholders (the “Meeting”) on June 29, 2021. The Company has received a requisition for a special meeting submitted to the Company by certain shareholders of the Company (the “Requisitioning Shareholders”) claiming to hold in excess of 5.1% of the Company’s class B subordinated voting shares (“Class B Shares”), including Mr. Zeeshan Saeed, the former President of the company and Mr. Anthony Durkacz, who is a Director of the Company. In addition to the Class B Shares controlled by this group, Mr. Saeed and Mr. Durkacz each hold 24 of the Company’s class A multiple voting shares (“Class A Shares”), with each Class A Share being entitled to 276,660 votes. Dr. Raza Bokhari, the Company’s Executive Chairman and Chief Executive Officer, holds the remaining 24 Class A Shares. As of the date hereof, the Company has 72 Class A Shares and approximately 19,161,602 Class B Shares issued and outstanding. The Requisitioning Shareholders are seeking to reduce the size of the Company’s board of directors to five, and to replace six of the incumbent directors, including Dr. Raza Bokhari, with three directors selected by such shareholders. Shareholders are not required to take any action at this time in respect of the Meeting. Shareholders will receive detailed information about the matters presented at the Meeting in a management information circular sometime in early June 2021.
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