York County-based Unilife Corp. has issued a statement in response to what it characterizes as "a series of malicious blogs containing false and misleading information published over recent months by short sellers on the Seeking Alpha website."
"Unilife has requested that the SEC investigate these short sellers and their associates for stock manipulation and illicit gains," the company said. "Unilife categorically refutes any allegations of wrong-doing by the company, its directors, officers and management."
This has been a tumultuous year for the medical manufacturing company, which has yet to turn a profit and is heavily invested in the future. Its stock was below $2 at one point in May 2013, but rallied strongly on announcement of several significant deals and passed $5.50 on March 19 of this year.
The statement came after a Seeking Alpha article titled "Unilife Corp.: Current Law Enforcement Investigation And Fraud Allegations From Insider." Headed by a disclosure that begins "I am short UNIS," the article mentions several issues that have arisen in the past year. Unilife's response goes down the list.
"Unilife has never paid anyone to publish articles about it," the statement said. "No officer has ever sold Unilife stock since the company listed on NASDAQ in 2010, with the CEO and COO having purchased in excess of $4 million in Unilife stock in recent years. The CFO's departure was not due to a resignation but part of a long-term succession plan. Mr. (Alan) Shortall has never been a director or officer of a company that has failed, or gone bankrupt. Unilife has successfully been through numerous due diligence processes conducted by multiple global pharmaceutical customers, investors, analysts, financial auditors and regulatory bodies."
Unilife also noted that its $60 million debt financing agreement announced in March was preceded by extensive due diligence from OrbiMed, the world's largest health care-dedicated investor.
Most of the allegations, Unilife said, "relate to a wrongful termination lawsuit by a former employee who was terminated 'for cause,' and the related SEC review of the matter, which Unilife first disclosed more than 18 months ago and has repeated in subsequent regulatory filings and earnings calls. Unilife has refuted these allegations, declined a settlement offer by the plaintiff, and expects to prevail should the case proceed to trial. Unilife has co-operated fully with the SEC in its review, provided extensive information, and responded to all questions. Unilife does not believe that there are any grounds for any action to be taken against the company."
Unilife asked the SEC "to act quickly to address these illegal actions by the relevant short sellers and their associates" and said the Unilife team, "which is now more than 190 strong and consisting of some of the most highly qualified industry experts," will continue to drive the business.