In a comment made to this post, school board member Brian Meshkin took me to task for a post I wrote last year about Salugen, his former company.
Brian stated that the “post is premised
on, and filled with, falsities.”
on, and filled with, falsities.”
This weekend I decided to spend some time trying to find out
what I got wrong. In doing so, I ended up with more questions than answers
about what actually went on with Salugen.
Here is what both Brian and I agree on. In July of 2008, the company was sold to Sherbrooke Equity AG of Switzerland . A
press release on October 6, 2008 announced
the sale.
"We believe that Salugen is the company of our future, as addiction along with other issues run rampant in our communities, both here and abroad. They can help to shed light on the problem and create solutions to these issues in our lives," said Lee Leblanc, Managing Director of Sherbrooke Equity AG. Specific terms of the transaction were not announced but the Company announced that the transaction would be accretive to Salugen shareholders and would address debt holders of the company as well.”
A month before that, on September 10, 2008, Dr. Kenneth Blum,
the Chief Scientific Officer of Salugen, issued a press release announcing his resignation and that of “other key executives.”
“All other key executives of the company, with the exception
of Brian Meshkin, CEO, also resigned. In accordance with Dr. Blum's agreement
with Salugen, all rights to the intellectual property portfolio primarily owned
by Dr. Blum and his research associates reverted to Dr. Blum, principal of
Synaptamine, Inc. and other named patent holders. Key factors in the departure
of the management team were not specifically disclosed however, under Mr.
Meshkin's direction, Salugen was unable to raise capital, adequately perform
operational activities or compensate employees and vendors.”
Brian claims that Dr. Blum was fired.
“Your accusations, based on a fraudulent press release, about
alleged mismanagement of Salugen is also untrue. Dr. Blum was terminated
from Salugen a year earlier due to his own character issues preventing him from
passing due diligence with an investment bank.”
You may note that the dates don’t match up. This won’t
be the first time in the Salugen story that this occurs.
In any event, Brian remained with the company and according
to his own posting on yatedo.com, he “ Led the company to an IPO (symbol:
SQZ.F) and exit for its initial investors in 4 years”
On To2C, he pointed out that the company went
public on October 4, 2008, “the day the world stock markets crashed.”
The company on the other hand, claimed to be doing well in spite of the
worldwide recession. Salugen issued a press release on April 13,2009 which
painted a picture of a company prospering.
“ZURICH, SWITZERLAND and SAN DIEGO, CA USA – April 13, 2009 –
Salugen® AG (www.salugen.com), a life sciences company, announces today the
successful listing of its stock traded on the FWB® Frankfurter Wertpapierbörse
(the Frankfurt Stock Exchange) under the symbol SQZ (FRA:SQZ.F). Last month
Salugen’s share price increased over 70 percent despite uncertain economic
times affecting the overall equity markets and is currently back on its listing
price.”
After that things start to get a little fuzzy.
Brian says that “About one year later – in September 2009 –
the transaction was unwound. The public entity, whose stock symbol was
SQZ.F, owned by Sherbrooke Equity, was sold to a German auction company.”
To say that Salugen AG's demise seemed sudden would be a huge understatement. Two months prior to this “unwinding” Salugen issued the
following press release:
ZURICH, SWITZERLAND and SAN DIEGO, CA USA – July 7, 2009 –
Salugen® (SYMBOL: SQZ.F), a publicly-traded international life sciences
company, announces today the launch of its Salugen Medical Group (SMG) division
beginning in the State of California. In its first week on the market, the
Salugen System is being prescribed for dozens of patients suffering from a
specific excess craving disorder, namely narcotic tolerance and dependence. The
Salugen Medical Group’s first week revenues are over $200,000, and anticipates
2009 revenues in California
to exceed $2M.”
A month later the future looked even rosier:
“ZURICH, SWITZERLAND and SAN DIEGO, CA USA – August 17, 2009
– Salugen® (SYMBOL: SQZ.F), a publicly-traded international life sciences company,
announces today that it is on target to achieve its 2009 revenue forecast of $3
million USD based upon July 2009 actual revenues and its pipeline for August
and September.
At $3 million USD in 2009, the Company will have record high revenues. Over the next twelve months, the Company’s revenue run rate will be in excess of $6 million USD. With the recent acquisition of the CraniYums consumer functional candy product line building upon its prescription HAVEOS product in physician offices, Salugen addresses a growing $18 billion market in the USA with its clinically-proven anti-craving products in both medical and consumer markets.”
At $3 million USD in 2009, the Company will have record high revenues. Over the next twelve months, the Company’s revenue run rate will be in excess of $6 million USD. With the recent acquisition of the CraniYums consumer functional candy product line building upon its prescription HAVEOS product in physician offices, Salugen addresses a growing $18 billion market in the USA with its clinically-proven anti-craving products in both medical and consumer markets.”
Oddly, the same press release referenced scientific studies
authored by Dr. Kenneth Blum, the guy whose character issues supposedly spooked
the same investment bank that was now touting his studies to support its claims.
The following month, the company “unwound.”
Brian claims that after 2009, Sherbrooke
and the guys in Switzerland
no longer had anything to do with Salugen. Salugen AG and its stock symbol
(SQZ.F) morphed into other companies (Pactolus AG, Berger Investments AG and
Mioomy AG) that soon "unwound" as well. Mioomy AG a German online auction company
even listed Brian as a “member” as late as March of 2010. Brian says he was
unaware of that until today.
A Google search today of the SQZ.F symbol turned up Serica Energy, PLC.
The Salugen website now redirects users to Proove Biosciences, Brian’s new company.
