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Biotech / Medical : XOMA. Bull or Bear? -- Ignore unavailable to you. Want to Upgrade?

To: aknahow who wrote (7901)	12/1/1998 9:01:00 PM
From: Bluegreen	Read Replies (1) \| Respond to of 17367

From Xoma website: XOMA Corporation November 30, 1998 Dear Fellow Stockholder: I would like to take the opportunity provided by this special mailing to bring you up to date on recent developments at XOMA and to urge you to vote on the proposal described in the accompanying materials. Change in Legal Domicile First of all, this letter accompanies a document describing a very important proposal to change XOMA's legal domicile (place of incorporation) from Delaware to Bermuda. The objective of the proposal is to enhance long-term shareholder value by positioning XOMA to benefit in the future from lower worldwide income tax rates and by providing other potential benefits, such as facilitating collaborations with multinational pharmaceutical companies. This change, more fully described in the enclosed materials, will have no impact on the conduct of our business in Berkeley and Santa Monica. Because of an unusual set of circumstances, we can change domicile now with minimal or no tax cost to the Company and none to our stockholders. If we don't act now, there is a risk that changing circumstances would make the transaction too expensive. Unlike many measures requiring stockholder approval, this proposal requires the approval of stockholders holding a majority of all outstanding shares. A typical proposal brings a voter turn-out of only 30-40%. Therefore, we must get significantly more than the usual stockholder response, so it is extremely important that you vote. We urge you to study the enclosed materials carefully and to vote promptly. Clinical Progress NEUPREX®, our first BPI-derived product, has received Orphan Drug designation from the FDA for the treatment of meningococcemia. This will provide seven years of U.S. market exclusivity following regulatory approval. The meningococcemia Phase III pivotal trial has successfully concluded three interim analyses and is moving rapidly toward a conclusion. Our Phase III NEUPREX® trauma trial is also progressing well. We have accrued more than 430 patients to date and are preparing an interim analysis on the first 400, to be reviewed by an independent Data Safety Monitoring Board. We plan to take at least one additional NEUPREX® medical indication into the clinic within the next few months. We have made excellent progress moving hu1124 through the clinic for the treatment of moderate to severe psoriasis. This is a humanized antiCD11a monoclonal antibody product that we are developing in collaboration with Genentech, Inc. We have concluded a Phase IA single-dose study and a Phase IB multiple-dose study and have completed enrollment in a Phase II double-blind, placebo-controlled study in Canada. Other Technologies We have licensed our LBP diagnostic assay to a third partner, Diagnostic Products Corporation (DPC). DPC and our two other licensees are developing diagnostic products using LBP, a sister protein to BPI, that may prove useful for diagnosing infectious complications treatable with NEUPREX®. We have now granted 15 licenses to our bacterial cell expression technology, and more are in negotiation. Patents & Research We have licensed Incyte Pharmaceuticals, Inc.'s BPI patent portfolio, thereby eliminating the risk of potentially costly BPI patent disputes. We have also received several new BPI patents and a patent covering therapeutic uses of LBP. Among other non-BPI related patents granted this year, we received one for a new method of humanizing antibodies for therapeutic use. This so-called Human Engineering method represents a new alternative to the most-commonly used humanization technology. This is a technology we hope will be broadly licensed. Our R&D efforts continue in several additional areas. XOMA and our collaborators have made presentations at a number of scientific meetings, including recent data demonstrating oral availability of peptides developed in our Mycoprex(tm) anti-fungal program. There clearly remain uncertainties about upcoming clinical trial results and the ultimate regulatory approvals and commercial prospects of our products, but our recent progress brings us closer to the possibility of product approvals and profits. That is why now is the time to enact the proposed change in domicile rather than waiting until later when the change could be prohibitively expensive. Your Board of Directors has carefully reviewed and unanimously recommended this proposal. Please take the necessary time to read through the enclosed Proxy Statement/Prospectus and Questions and Answers section and record your vote. Sincerely, John L. Castello Chairman of the Board, President and Chief Executive Officer P.S. PLEASE BE SURE TO VOTE ON THE PROPOSAL For additional information see also Change of Domicile letter, the Change of Domicile Q and A and the November 24, 1998 news release. The complete Prospectus is available on Edgar.