Arix Bioscience, the biotechnology investor backed by restaurant tycoon Richard Caring and biotech entrepreneur Sir Christopher Evans, has been forced to halt two board appointments after its largest shareholder called for a total overhaul in a scathing letter.
Mayfair-based Arix has had to pause the planned hire of two directors due to join the business this month after Acacia Research, an American investor advised by Neil Woodford, said in a damning public letter that the firm faced “seemingly uncontrollable board tumult” and was being led by a “woefully inadequate investment group” after 18 director departures in five years.
In response, Arix said it had an experienced board and was already building its investment team in the UK and the US. Fallen fund manager Mr Woodford is not advising Acacia on this saga, people familiar with the matter said.
Arix was due to welcome Dr Axel Wieandt, a former Morgan Stanley and Deutsche Bank banker, on to the board alongside biotech expert James Noble.
However it has told investors that while the pair remain “highly qualified” the appointments are on hold while it reviews parts of the business including “the question of board composition”.
The findings of its review, which will also look at remuneration structures and involve a wider consultation with shareholders, is expected to be published by April 23.
Acacia wants to have more of a say on who is on the board and wants the firm to immediately begin looking for a new boss to replace existing executive chairman Naseem Amin.
Acacia warned in its letter last month that “shareholders have every reason to be alarmed” adding that it cautions the board “against taking any steps to make further investments until a suitably qualified team of experienced investment professionals has been retained”.
Acacia last year bought the 19pc stake in Arix Bioscience that was previously owned by Mr Woodford, who is now advising the business as part of his shock comeback under Woodford Capital Management Partners.
Investors in his failed fund missed out on huge gains in the share sale to Acacia. Spokesmen for Arix, Acacia and Mr Woodford declined to comment.