Prnewswireยท2025-11-11 01:09Core Viewpoint - DOMA Perpetual Capital Management LLC, a significant stockholder of Pacira BioSciences, Inc., is urging the Board to hire bankers and initiate a full sale process for the company due to perceived management underperformance and financial mismanagement [1][2][4]. Financial Performance and Management Concerns - Pacira's management has been criticized for excessive spending, with stock-based compensation projected to be approximately 6% of the company's market capitalization for 2025, exceeding the firm's entire operating income [2][6]. - Year-to-date sales of Zilretta have declined by 2% year over year through Q3, indicating poor business performance [3]. - Revenue growth has been modest at 3% year over year, while expenditures have surged, with R&D costs increasing by 36% and SG&A by 25% year over year [6]. Valuation and Sale Potential - A potential sale could yield a valuation of around $2.7 billion, translating to approximately $66 per share, which is three times the current stock price and represents a reasonable acquisition valuation [4][5]. - The cash flows from Pacira's assets, particularly Exparel, could exceed $10 billion through patent expiration, suggesting significant value under a larger owner [4]. Strategic Recommendations - The company should immediately pursue a sale process, with a target completion date before the end of Q1 2026 [7]. - Cost-cutting strategies must be implemented to enhance shareholder returns, and all new development programs should be put on hold until a sale is explored [12]. - Free cash flow should be prioritized for share buybacks, with a recommendation for a new $300 million buyback program following the completion of the current one [12]. Shareholder Relations and Governance - The Board's actions have been perceived as neglecting shareholder interests, with ongoing dilution of shareholder value through unapproved share issuances [10][11]. - DOMA has been in communication with the Board for over a year, advocating for a shareholder-friendly capital allocation framework, which has only recently begun to materialize [9].