Deep Track Capital Urges Dynavax Shareholders to Elect Four Independent Nominees to the Board

Dynavax, a biotechnology company, is facing a proxy contest for control of its board of directors. Deep Track Capital, LP, a significant shareholder with approximately 14.82% stake, has issued a letter to shareholders urging them to elect four independent nominees, Brett Erkman, Jeffrey Farrow, Michael Mullette, and Donald Santel, to the board. Deep Track highlights concerns over the company's strategy, particularly the lackluster performance of its lead asset, Heplisav, and the need for fresh perspectives to address fundamental problems.

Key Takeaways:

• Heplisav, the key asset at Dynavax, has not reached its full potential under the current management's strategy, with missed revenue targets and declining market share growth.
• The company's stock price has underperformed the Nasdaq Biotechnology Index (NBI) for multiple years, indicating fundamental problems with the company's strategy.
• The current board lacks independent and objective perspectives, with the absence of relevant directors with direct capital markets or institutional investor backgrounds.
• Deep Track's nominees are highly qualified, open-minded, and committed to working constructively for the benefit of all Dynavax shareholders, rather than seeking a quick profit.
• The company's repeated baseless mischaracterizations about Deep Track and its nominees are a distraction from the fundamental issues with the company's strategy.
• The June 11, 2025, Annual Meeting is a critical opportunity for shareholders to effect real change and bring fresh perspectives to the board.

Statistics:

• Heplisav U.S. sales in 2024 fell short of the board's target by $7 million, and the product's market share declined by 3 percentage points in the fourth quarter of 2024 compared to the fourth quarter of 2023.
• Dynavax's stock price declines by 11% the day after management's call on the earnings declaring "exactly how we had planned" for Heplisav's missed targets.
• Over three years, Dynavax's stock price has underperformed the Nasdaq Biotechnology Index (NBI) by -32%.

Sources:

1. Dynavax Technologies Corporation, Proxy Statement (no date specified)

2. Dynavax Technologies Corporation, Earnings Call Transcript (no date specified)

3. Dynavax Technologies Corporation, Earnings Call (no date specified)

4. Source name not specified, News Release (no date specified)

5. Dynavax Technologies Corporation, Proxy Filing (no date specified)

6. Glass, Lewis & Co., Report on Proxy Contests (no date specified)

7. Glass, Lewis & Co., Report on Dynavax Board (no date specified)