Tenax Therapeutics Inc., a pharmaceutical firm in the critical care market, announced Friday that its chief executive John Kelley has resigned from the company.
Morrisville-based Tenax also said its board has initiated a comprehensive review of strategic alternatives to current operations – a process that could result in the company being acquired.
“This development does not change the focus or direction of the company, which remains dedicated to enhancing shareholder value through the development and commercialization of products for the critical care market,” said Tenax chair Ronald Blanck in a statement.
The price of Tenax shares plummeted more than 75 percent in late January after the company announced disappointing phase 3 trial results for its heart medication levosimendan. The company, however, said it continues to believe the drug is safe and effective as it pursues levosimendan’s regulatory filing in Canada.
Tenax shares are currently priced at 49 cents. They fell 3.8 percent on Friday.
Tenax, which operated under the name Oxygen Biotherapeutics Inc. until 2014, acquired the drug levosimendan in 2013 from Phyxius Pharma, a New Jersey biopharmaceutical company that Kelley co-founded.
At the acquisition’s closing, Kelley joined Tenax as its chief executive, and one month later he joined the company’s board of directors – a position he retained until his resignation.
Tenax said it’s engaged Ladenburg Thalmann & Co. to head the company’s strategic review efforts as its financial advisor.
Ladenburg Thalmann, the investment bank arm of New York’s Ladenburg Thalmann Financial Services, led Tenax through its acquisition of levosimendan in 2013.
As part of his severance benefits, Kelley will receive a lump sum of more than $500,000, payable on the 60th day following his April 3 departure.
Per Kelley’s separation agreement, the lump sum figure includes both the full amount of his current annual base salary and a pro-rated amount of the maximum annual bonus he could have received for the year.
According to the Friday announcement, Kelley will be available to Tenax for special consulting services at his discretion and at a rate of $500 an hour for up to 12 months following his departure.
Michael Jebsen, Tenax’s current president and chief financial officer, has been appointed as interim chief executive of Tenax, a position he’s held before from 2011 to 2013.
He’ll also continue serving as president and chief financial officer.
Tenax reported an operating loss of $52.7 million for its fiscal year 2016 – an increase in losses of more than 250 percent from 2015.
The company said it does not intend to disclose additional details about a potential transaction unless and until it’s entered into one.
Note: This story is from the North Carolina Business News Wire, a service of UNC-Chapel Hill’s School of Media and Journalism