Stockholder Sues SciClone Pharmaceuticals, Others Over Proposed Merger

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SciClone Pharmaceuticals, Inc., its board of directors, Silver Biotech Investment Limited, and its subsidiary, Silver Delaware Investment Limited, are the defendants in a proposed class action lawsuit alleging they released a misleading proxy statement in connection with a merger between SciClone and Silver. The complaint lists the following four reasons the proxy statement is believed to be unlawful:

• First, the Proxy Statement allegedly omits material information regarding the Company’s financial projections and the valuation analyses performed by the Company’s financial advisor, Lazard Frères & Co. LLC.
• Second, the Proxy Statement allegedly omits material information regarding potential conflicts of interest of the Company’s officers.
• Third, the Proxy Statement allegedly omits material information regarding potential conflicts of interest of the Company’s financial advisor, Lazard.
• Fourth, the Proxy Statement allegedly omits material information relating the background leading up to the Proposed Transaction.

The suit claims the defendants must release the details of Lazard’s financial analyses plus any information about whether the company has performed services for the defendants within the past three years, as well as the amount of compensation it may have received.

The complaint further argues that stockholders are entitled to know the details of any communications regarding board members’ future employment with Silver Biotech and whether non-disclosure agreements presented by the board contained provisions that may have prohibited other potential buyers from submitting superior offers for the company.