DellaCamera says Enzon needs to do more than spin off its biotech business

By Lisa Kerner

Charlotte, N.C., May 20 - Enzon Pharmaceuticals, Inc. investors led by DellaCamera Capital Master Fund, Ltd. are encouraged by the company's plans to spin off its biotechnology business but demanded Enzon explore strategic alternatives including a sale of all or part of its commercial operations, which includes its marketed products, royalties and manufacturing businesses.

DellaCamera also wants management "to re-evaluate its spending and partnering posture as regards to its biotechnology business," according to a schedule 13D filing with the Securities and Exchange Commission.

In addition, the 5.9% shareholder asked that any purchase offer for Enzon be presented to shareholders for their consideration, the filing said.

It was previously reported that Enzon expected its spinoff to close in the fourth quarter of 2008.

The Bridgewater, N.J., biopharmaceutical company planned to keep the current marketed products of Abelcet, Adagen, DepoCyt and Oncaspar, the rights to current PEG royalty revenues and the manufacturing facility in Indianapolis.

DellaCamera had expressed a lack of confidence in Enzon's board in a May 1 letter to the company. Specifically, the shareholder questioned why the board has not held chairman, president and chief executive officer Jeffrey H. Buchalter accountable for Enzon's poor stock performance given his "truly appalling" compensation.

The investor called for the resignations of compensation committee members Dr. Goran A. Ando, Rolf A. Classon and Victor P. Micati "for approving Mr. Buchalter's runaway compensation," the letter, included as part of a schedule 13D filing with the SEC, stated.

According to the investor, Buchalter received total compensation of $5.18 million in 2007, consisting of $773,558 in salary, $1.16 million in bonuses, $974,657 in stock awards, $2.14 million in option awards and $134,199 in other compensation.

DellaCamera said it was reviewing its voting alternatives with respect to all class III directors - Classon, Robert LeBuhn and Robert C. Salisbury - up for election at Enzon's annual meeting on Thursday.

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