EVANSTON, Ill., Aug. 30 /PRNewswire-FirstCall/ -- Northfield Laboratories
Inc. (Nasdaq: NFLD), a leading developer of an oxygen-carrying blood
substitute for trauma and elective surgery situations, today distributed the
following letter to shareholders from Dr. Steven A. Gould, Northfield's
Chairman and Chief Executive Officer:
Dear Fellow Shareholder:
Part of my mandate, upon assuming the office of Chief Executive Officer,
was to ensure that Northfield shareholders were informed about, and had the
opportunity to participate in, our vision of the company. As you know, we
have sent you a number of mailings in connection with our Annual Meeting.
Since I became CEO, I have also been engaged in a large number of personal
conversations with many of our loyal but frustrated shareholders. The
essential question I have been asked again and again is, "Why should I vote
for you and the other Board nominees, and what will you do to enhance
shareholder value?"
The future success of Northfield is entirely dependent upon our ability to
bring PolyHeme(TM) to market. First and foremost we must resolve our
regulatory situation with the FDA. Once the FDA and Northfield have reached a
consensus about the appropriate next steps, the company can aggressively move
forward to raise additional funds and secure a strategic partnership. It is
naive and unrealistic to believe that a potential partner who could add value
to Northfield would be willing to commit to a major business combination
before resolution of our future regulatory path.
I would like to take this opportunity to again detail the important facts
about the status of PolyHeme and its implications for Northfield which
previously appeared in our Annual Report. I believe that this will help you
understand why it is so important to support your Board and its nominees at
this critical juncture.
REGULATORY STATUS
In August 2001, we submitted our Biologics License Application to the Food
and Drug Administration seeking approval to market PolyHeme for use in the
treatment of urgent, life-threatening blood loss. This was a significant
milestone for Northfield, representing the culmination of 16 years of product
development, clinical studies and data analysis. It was also a landmark event
for the industry, because it was the first BLA for a blood substitute for
human use in the United States. The decision to submit the BLA was based on
the demonstration that PolyHeme supported life in seriously injured, bleeding
patients and significantly improved survival in situations when blood could
not be used. We were aware that despite the compelling outcomes, there would
be regulatory hurdles. PolyHeme is an innovative product, with no precedent
to provide guidance for the FDA. The history of safety concerns for other
blood substitutes as well as other highly visible product recalls added a
considered and understandable degree of caution. However, we felt the BLA
submission was appropriate.
In November 2001, the FDA issued a refusal to file letter with respect to
our BLA filing. Based on our discussions with the FDA, we have learned that
many of the agency's concerns are focused on the perceived broad nature of the
proposed indication for the use of the product, the validity of the historical
control group and the actual trial design itself. These concerns reflect the
fact that our studies were not designed as a classical registration trial
using a randomized, prospective, double-blinded design, but rather a trial
under conditions involving real life, unplanned, life-threatening blood loss
simulating situations in which no alternative treatment is available. The
ethical and logistic considerations involved in this environment did not allow
us to use a traditional approach to trial design. The endpoint in the trial
was patient survival, and the use of PolyHeme led to a dramatic improvement
over the predicted survival based on historical data. We believe the strength
of the data justified our BLA submission.
We have had numerous recent meetings and follow-on discussions with the
FDA. We have described in great detail the patients and settings in which
PolyHeme would and would not be used. We have presented additional
information regarding the historical controls, and have also submitted other
data that we believe validate the control group. We have also discussed the
challenges of the traditional trial design for our proposed indication. Our
dialogue has been instructive and encouraging, although it is possible that
additional trials will still be necessary. We are striving to reach a
consensus as quickly as possible in order to move forward to regulatory
approval for PolyHeme and resolve the uncertainty that currently exists.
FUNDING
It is clear that we will need additional funding in the future. Clarity
and certainty regarding our regulatory status are essential to positioning
ourselves to move rapidly and effectively to raise money in the capital funds
markets when the climate on Wall Street becomes more favorable. This has been
a tumultuous year for the market, but we want to be poised to access new
capital when the market normalizes. In the meantime, as of May 31, 2002 we had
$18.4 million in available cash, which should support our on-going operations
for at least 18 months.
PARTNERSHIP
Over the course of PolyHeme's development, we have had discussions with
several large pharmaceutical companies that have expressed strong interest in
partnering with Northfield. We believe a partner with experience in the
surgical and critical care areas would be an excellent strategic fit. The
right partner would add expertise in the areas of marketing, regulatory
affairs and manufacturing and enhance the likelihood of successful
commercialization of PolyHeme. As is the case with fund raising, clarity and
certainty regarding our regulatory status are essential in order to secure a
world-class partner on attractive terms for our shareholders.
In summary, we have been engaged in what we believe is a constructive
dialogue about exactly what information the FDA will require and how
Northfield should provide it. We hope to reach a consensus with the FDA in
the near future.
In the meantime, I am fully committed to making Northfield accessible and
responsive to all current and future shareholders. We will continue to keep
you apprised of important developments as they occur. I am asking you for
your vote on the BLUE proxy card to help us realize Northfield's potential.
Thank you for your continued support.
Steven A. Gould, M.D.
Chairman and Chief Executive Officer
A. REMEMBER -- ONLY YOUR LATEST DATED PROXY COUNTS!
If you have already voted a White proxy card in error, you have every legal
right to change your vote by signing and returning a later-dated BLUE proxy
card today.
To ensure that your vote is counted for Northfield's director nominees, do NOT
sign any White proxy card sent to you by C. Robert Coates, even to withhold
your support for the Coates nominees. Simply discard the White card.
If you have any questions or need assistance in voting your shares, please
call:
II. Innisfree M&A Incorporated
501 Madison Avenue, 20th Floor
a. New York, New York 10022
Call Toll-Free: (888) 750-5834
Banks and Brokers call collect (212) 750-5833
Statements in this release that are not strictly historical are
"forward-looking" statements that are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995. Forward-
looking statements involve known and unknown risks, which may cause the
company's actual results in the future to differ materially from expected
results. These risks include, among others: competition from other blood
substitute products; the company's ability to obtain regulatory approval to
market PolyHeme commercially; the company's and/or its representative's
ability to successfully market and sell PolyHeme; the company's ability to
manufacture PolyHeme in sufficient quantities; the company's ability to obtain
an adequate supply of raw materials; the company's ability to maintain
intellectual property protection for its proprietary product and to defend its
existing intellectual property rights from challenges by third parties; the
availability of capital to finance planned growth; and the extent to which the
hospitals and physicians using PolyHeme are able to obtain third-party
reimbursement, as described in the company's filings with the Securities and
Exchange Commission.
Visit the Northfield website at: http://www.northfieldlabs.com .
SOURCE Northfield Laboratories Inc.
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Related links:
http://www.northfieldlabs.com
CONTACT:
Steven A. Gould, M.D, Chief Executive Officer
of Northfield Laboratories, +1-847-864-3500, or Investors, Lisa
Fortuna, +1-312-640-6779, or Media, Cindy Martin,
+1-312-640-6741, both of FRB Weber Shandwick
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