THE spittle is flying at Bioxyne, formerly known as Hunter Immunology, before a special meeting of shareholders in the cough medicine minnow next Tuesday.
With the two biggest shareholders at odds over the future of the company, those voting at the meeting, including millionaire funds manager Chris Cuffe and former Future Fund boss David Murray, have been handed the opportunity to boot as many as four directors from the boardroom.
Biggest shareholder Octa Phillip wants chairman Ian Mutton and managing director David Radford given the heave-ho and its man Stewart Washer elected.
However, the second-biggest shareholder, co-founder Phillip Comans, wants to rid the board of Octa's managing director, Jeremy Curnock Cook, and another director with ties to Octa, Doug Wilson.
Advertisement As the meeting draws closer, the stoush becomes uglier, with Octa coughing up hairballs on a website set up to attack the existing regime.
The broker has made complaints to the corporate watchdog about Radford's behaviour during the bitterly fought campaign and yesterday wrote to shareholders criticising management for wasting their money.
It is also unhappy that Radford is pulling down more than $500,000 a year (including super) amid a tanking share price.
Underlying the stoush is a dispute over what Bioxyne should do next after its flagship product, HI-164, a drug designed to treat smoker's cough, flunked clinical trials in June.
Smoker's cough, or chronic obstructive pulmonary disease in doctors' lingo, is a disorder that infects people who have damaged their lungs by sucking down too many gaspers or being exposed to toxic air.
News of the bad test result smashed Bioxyne's share price, but the company is sitting on about $2 million in cash.
Octa is concerned it is burning through the pile at more than $100,000 a month and will tear up more dollars if it continues to try to commercialise the product.
The broker has charge of about 20 per cent of the company, a stake its Asia Pacific Healthcare Fund II spent about $5.2 million to build. As that represents more than 10 per cent of the $42 million managed by the fund, any loss would eat significantly into its otherwise excellent returns.
Octa wants Bioxyne to cut its losses and move on, and has approached the board with a proposal for a new business.
Comans, who owns about 8 per cent, reckons the clinical trial pointed to potential benefits for some patients and wants to keep going rather than ''crystallising a major loss''.
Yesterday, Octa told shareholders that result was identified by going back and sifting through the test data in one of 18 retrospective analyses. ''The other 17 showed no efficacy,'' it said.
CBD couldn't raise anyone from Bioxyne yesterday, but in an August letter to shareholders Mutton said the data provided ''significant signals'' and pledged to ''continue to fight for the development of the HI-164 vaccine''.
Whether he gets a chance to do that should be clear once the sputum settles after the meeting next week.
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