Doma Perpetual urges Pacira shareholders to vote for its board candidates

DOMA Perpetual Capital Management, which, together with its affiliates, beneficially owns approximately 7.5% of the outstanding shares of common stock of Pacira (PCRX) BioSciences, has sent a letter to the Company’s stockholders outlining the rationale for change in the composition of the Company’s Board of Directors. DOMA said, “In its letter, DOMA Perpetual asserts Management and the Board continue to promote a risky strategy of “bet the farm” litigation that has already likely cost the Company more than a third of future EXPAREL revenues in a prior settlement. Pacira’s revenue growth remains weak and substantially below what Management promised in its 5×30 plan, while operating expenses and executive compensation have increased dramatically. Stock-based compensation has risen 38% over the last five years and the Board has moved from performance-based compensation to RSUs, guaranteeing Management multimillion-dollar compensation packages while shareholders have been taken to the cleaners. In the last two years, CEO Frank Lee made $28 million while the Company’s net income was negative $93 million; astoundingly, in this period, Mr. Lee made more money than all shareholders combined. Pacira’s stock price has fallen approximately 54% over the last 10-year period, 62% over the last 5-year period, and 29% since Frank Lee took over as CEO. Management and the Board seem willing to gamble with the Company’s future in risky IP battles, despite a bruising loss, leading to a costly settlement, just last year. EXPAREL is an “essential and mission-critical” asset. DOMA contends the Company’s unmet goals and shifting metrics in its 5×30 plan are proof that the CEO is grossly underperforming and that any future legal loss related to EXPAREL would jeopardize the future of the Company. DOMA believes Pacira’s board is gambling with shareholder money in its continued IP litigation and unproven, cash-burning 5×30 plan, and that Pacira’s current strategy is a house of cards built by a Board culture that evinces a complete failure of risk management. Shareholders should not have to lose it all to expose the Board’s gross negligence.”