Liz Hoffman, in the MoneyBeat section of the Wall Street Journal (Nov. 6, 2014) published her article "Allergan Tries the 'Jewish Dentist' Defense". It starts off, "Allergan Inc. on Thursday morning produced a letter signed by 33 ophthalmologists opposed to a takeover of the company by Valeant Pharmaceuticals International Inc., pulling out a 1970s-era maneuver that came to be known as the "Jewish Dentist" defense."
She goes on to give the backstory to the defense tactic, which is that, in 1975, a lawyer, Joseph Flum (a member of the M&A firm Skadden, Arps, Slate, Meagher & Flomm LLP), helped a client, Sterndent, a manufacturer of dental equipment, avoid a hostile takeover by a foreign-owned company, Magus Corp. Mr. Flum did this by whipping up the agitation and suspicion of Jewish dentists through publicizing the fact that Kuwaiti investors held a 5% stake in Magus. "Let's just put it in the statement. Don't make any claims or anything. Just put it in the statement that they should be aware that Arabs own 5% of it."
Hoffman goes on to write that "Allergan is trying a version of the same play" through physicians signing on to the Allergan support letter (which at this moment stands at 114 doctors, not the 33 mentioned at the time of her publication of this article this morning). She equates this to being an unfounded scare tactic, just a public relations maneuver on par with the revolting fear campaign driven by ethnic tensions for the 40-year-old Sterndent/Magus example. It is not mentioned anywhere that Valeant intends (in fact has been reported in the WSJ as confirming they do intend) to severely cut Allergan R&D as much as 90%), a position that virtually all physicians will never support. It is not a scare tactic or PR stunt: it is the truth. And shareholders need to know this before the Dec. 18 vote because physicians are the first-line customer base for Allergan.
And something else material that was not noted in this WSJ piece: The law firm Skadden, Arps, Slate, Meagher & Flom LLP is one of the lead law firms hired by Valeant Pharmaceuticals to represent their interests, a fact which Ms. Hoffman is aware of, but never mentions in her article. She dismisses the Allergan physician letters of support as just so much vacuous PR, on par with the Flum "Jewish Dentist" defense which was originally based on ethnic discrimination.
A very disturbing and ethically-challenged article (and that includes, front-and-center, journalistic ethics).
She goes on to give the backstory to the defense tactic, which is that, in 1975, a lawyer, Joseph Flum (a member of the M&A firm Skadden, Arps, Slate, Meagher & Flomm LLP), helped a client, Sterndent, a manufacturer of dental equipment, avoid a hostile takeover by a foreign-owned company, Magus Corp. Mr. Flum did this by whipping up the agitation and suspicion of Jewish dentists through publicizing the fact that Kuwaiti investors held a 5% stake in Magus. "Let's just put it in the statement. Don't make any claims or anything. Just put it in the statement that they should be aware that Arabs own 5% of it."
Hoffman goes on to write that "Allergan is trying a version of the same play" through physicians signing on to the Allergan support letter (which at this moment stands at 114 doctors, not the 33 mentioned at the time of her publication of this article this morning). She equates this to being an unfounded scare tactic, just a public relations maneuver on par with the revolting fear campaign driven by ethnic tensions for the 40-year-old Sterndent/Magus example. It is not mentioned anywhere that Valeant intends (in fact has been reported in the WSJ as confirming they do intend) to severely cut Allergan R&D as much as 90%), a position that virtually all physicians will never support. It is not a scare tactic or PR stunt: it is the truth. And shareholders need to know this before the Dec. 18 vote because physicians are the first-line customer base for Allergan.
And something else material that was not noted in this WSJ piece: The law firm Skadden, Arps, Slate, Meagher & Flom LLP is one of the lead law firms hired by Valeant Pharmaceuticals to represent their interests, a fact which Ms. Hoffman is aware of, but never mentions in her article. She dismisses the Allergan physician letters of support as just so much vacuous PR, on par with the Flum "Jewish Dentist" defense which was originally based on ethnic discrimination.
A very disturbing and ethically-challenged article (and that includes, front-and-center, journalistic ethics).