Echo Therapeutics ($ECTE) has responded to an angry shareholder seeking change at the company, and both sides have agreed to meet, presumably to discuss their differences and hash out a path forward.
For now, the Philadelphia medical device company isn't revealing the details. Echo, developer of the Symphony needle-free, wireless continuous glucose monitoring system, disclosed Sept. 5 that its board of directors--which includes executive chairman and interim CEO Robert Doman--has responded in writing to Platinum-Montaur Life Sciences' Aug. 30 letter demanding reforms at the company. Echo said it has also "communicated" with the investor--the company's largest--about "matters raised" in Platinum-Montaur's open letter, though it was mum about the specifics.
That's potentially a sign that an agreement on a revised corporate strategy is in the making. Echo noted that both sides are planning to meet next week. And the company added that "it continues to consider and seek to enter into collaborations or licenses regarding the future development and distribution of its products, and remains willing to enter into discussions regarding potential collaborations or licenses."
So maybe there's a happy ending in store for the company, which has ties to MIT's famed inventor Robert Langer and made an early splash. Beyond the next-generation continuous glucose monitoring system under development, Echo is also advancing similar technology designed to boost topical drug delivery. But the company has struggled. Platinum-Montaur, which owns about 20% of Echo's outstanding common stock, complained that its stock price plunged 95% over two years and that Echo has been hampered by "ineffective directors" and leadership. As all of this came to a head, CEO Patrick Mooney took an immediate leave of absence, and Echo is actively searching for his replacement.
Platinum-Montaur wants Echo to replace "ineffective directors" with industry professionals and hire a high-caliber recruiting firm to help find a new CEO. The investment firm also wants Echo to link up with a partner in China to pursue development and manufacturing of its continuous glucose monitoring system and is recommending a strategic consultant to help develop a strategic vision moving forward.
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