Today, Dr. Johnson Lau, Chairman and Chief Executive Officer of Athenex, Inc. (NASDAQ:ATNX), informed shareholders he received a notice of a proposed administrative fine of RMB 100,000 (approximately $14,300) from the China Securities Regulatory Commission (“CSRC”), for a matter unrelated to Athenex.
The CSRC notice was issued in connection with accounting and compliance infractions by certain senior leaders of Porton Pharma Solutions Ltd (300363.SHE) (“Porton”), a company for which Dr. Lau formerly served as an outside director from March 2016 to December 2019. The infractions, which occurred in 2018, resulted in inaccurate financial disclosures by Porton that were reviewed and approved by its board of directors. The CSRC notice includes proposed administrative fines for Porton, senior executives, as well as members of the board of directors and management team that served at the time of the infractions.
Dr. Lau did not serve on the Audit Committee of Porton, and the administrative notice does not allege any wrongdoing by Dr. Lau. In, addition, Dr. Lau’s decision to resign from the Porton board in December 2019 was amicable and unrelated to this matter.
Dr. Lau intends to request a hearing to oppose the proposed fine, a standard procedure with these matters.
Following review, Athenex’s Board of Directors remains confident in Dr. Lau’s ability to lead Athenex as Chairman and CEO in pursuit of the development and regulatory approval of novel therapies for patients with cancer.