DEF: Oramed Pharmaceuticals Schedules 2025 Annual Meeting, Seeks Shareholder Approval for Key Governance and Incentive Plan Updates

Oramed Pharmaceuticals Inc. announced its 2025 Annual Meeting of Stockholders to be held on August 19, 2025, seeking approval for director re-elections, auditor ratification, and an increase in its stock incentive plan shares.

Summary

• The Annual Meeting of Stockholders will be held on August 19, 2025, at 10:00 a.m. (Eastern time) in Boca Raton, FL.
• The record date for stockholders entitled to notice of and to vote at the Annual Meeting is July 3, 2025.
• Shareholders will vote on three proposals: re-electing seven directors, ratifying Kesselman & Kesselman as the independent registered public accounting firm for the 2025 fiscal year, and approving an amendment to the 2019 Stock Incentive Plan.
• The proposed amendment to the 2019 Stock Incentive Plan seeks to increase the aggregate number of shares authorized for issuance by 2,000,000, bringing the total to 9,500,000 shares of common stock.
• As of July 3, 2025, there were 40,845,087 shares of common stock outstanding and entitled to vote.
• Nadav Kidron, President, Chief Executive Officer, and Chairman, beneficially owns 7.4% of the common stock.
• Dr. Miriam Kidron, Chief Scientific Officer and Director, beneficially owns 3.0% of the common stock.
• BLM Investment Partners, L.P. is a greater than 5% holder, beneficially owning 6.6% of the common stock.
• Total compensation for Nadav Kidron in Fiscal 2024 was $2,097,689 (Summary Compensation Table) and $2,141,803 (Compensation Actually Paid).
• Net Income (Loss) for Fiscal 2024 was $(15,920), compared to $5,088 in 2023 and $(37,764) in 2022.
• The value of an initial $100 investment based on Total Shareholder Return (TSR) was $105 in 2024, $19 in 2023, and $84 in 2022.
• Audit fees paid to Kesselman & Kesselman were $124,882 in Fiscal 2024 and $132,501 in Fiscal 2023, with total fees of $144,368 and $165,364 respectively.
• Oramed Ltd., a subsidiary, purchased 14,110,121 ordinary shares of Alpha Tau Medical Ltd. for approximately $36,900,000 at $2.612 per share on April 28, 2025.
• In connection with the Alpha Tau investment, Oramed Ltd. will provide investor relations and public relations services for a non-refundable fee of $3,000,000 over three years and receive warrants to purchase up to 3,237,000 Alpha Tau shares.
• The Board of Directors unanimously recommends that stockholders vote FOR all three proposals.

Sentiment

Score: 6

Explanation: The document is primarily a procedural proxy statement for an annual meeting, focusing on corporate governance, executive compensation, and a proposed increase in the stock incentive plan. While it reports a net loss for 2024, it's an improvement from 2022, and TSR showed a positive rebound in 2024 after a very poor 2023. The strategic investment in Alpha Tau Medical Ltd. is a notable positive development, indicating potential future growth avenues. The overall sentiment is neutral to slightly positive due to the strategic move and improved TSR, despite the continued net loss.

Positives

• The Board unanimously recommends approval of all proposals, indicating internal alignment on key governance and incentive matters.
• The company's executive compensation program is designed to attract, retain, and motivate key personnel, aligning their interests with long-term stockholder value.
• Net income, while still a loss, showed significant improvement from $(37,764) in Fiscal 2022 to $(15,920) in Fiscal 2024.
• Total Shareholder Return (TSR) for an initial $100 investment rebounded positively to $105 in Fiscal 2024, after a challenging $19 in 2023.
• The strategic investment of approximately $36.9 million in Alpha Tau Medical Ltd. and the associated services agreement could open new revenue streams and strategic partnerships.
• The company has adopted a Code of Ethics and an Insider Trading Policy, demonstrating a commitment to compliance and good corporate governance.
• Stockholders previously approved the executive compensation program with over 90% of votes cast, indicating strong shareholder support for the compensation philosophy.

Negatives

• The company reported a net loss of $(15,920) for Fiscal 2024.
• The Total Shareholder Return (TSR) for an initial $100 investment was significantly low at $19 in Fiscal 2023, indicating substantial value erosion in that period.
• The roles of Chairman and Chief Executive Officer are combined, which some corporate governance best practices suggest should be separated for enhanced independent oversight.
• The company does not have a formal policy regarding the consideration of director candidates recommended by stockholders.
• The newly formed Investment Committee does not operate under a written charter, which could be seen as a governance weakness.
• Certain executive compensation arrangements are expected to result in non-deductible compensation exceeding $1,000,000 due to U.S. tax law (Section 162(m) of the Code).

Risks

• Failure to approve the amendment to the 2019 Stock Incentive Plan could hinder the company's ability to attract, retain, and motivate key employees, consultants, and directors.
• The company may incur non-deductible compensation expenses exceeding $1,000,000 for certain executive officers due to changes in Section 162(m) of the U.S. Internal Revenue Code.
• The strategic investment in Alpha Tau Medical Ltd. carries inherent risks associated with equity investments, including potential declines in the value of Alpha Tau shares.
• The strategic investor relations and public relations services agreement with Alpha Tau Medical Ltd. is for a three-year term with limited termination rights, potentially committing the company to a long-term arrangement regardless of performance.
• The company's reliance on discretionary bonuses and equity awards, while aligned with performance, may lack specific, pre-defined metrics, potentially leading to less predictable compensation outcomes.

Future Outlook

The company's future success is dependent on its ability to maintain a competitive position in attracting, retaining, and motivating key personnel, which the proposed amendment to the 2019 Stock Incentive Plan is designed to support. The Compensation Committee is considering alternative models and equity vehicles for future equity-based grants to further align executive interests with stockholder value.

Management Comments

• Our Board unanimously recommends that you vote FOR all of the above proposals.
• We believe that our executive compensation is appropriately designed to incentivize our NEOs to work for our long-term prosperity, is reasonable in comparison with the levels of compensation provided by comparable companies and reflects a reasonable cost.
• We believe our NEOs are critical to the achievement of our corporate goals, through which we can drive stockholder value.
• We believe that a competitive base salary and monthly compensation is a necessary element of any compensation program that is designed to attract and retain talented and experienced executives.
• We believe that attractive base salaries can motivate and reward executives for their overall performance.
• We believe that annual bonuses payable based on the achievement of short-term corporate goals incentivize our NEOs to create stockholder value and attain short-term performance objectives.
• The Compensation Committee believes that stock participation aligns executive officers interests with those of our stockholders.
• We believe that time-based vesting encourages recipients to build stockholder value over a long period of time and that performance-based vesting encourages recipients to achieve goals that benefit the Company.
• We believe that this leadership structure [combined CEO and Chairman] is appropriate to our Company given the current circumstances, including the size and operations of the Company.
• The Board also believes that the Company’s stockholders are best served by the Board having flexibility to consider the relevant facts and circumstances and determine, at the time of the Chairman’s election, the best leadership structure for the Company rather than by adhering to a formal standing policy on the subject.
• We believe that the overall enterprise risk management process is more properly overseen by all of the members of the Board.
• We believe stockholders should have the ability to communicate directly with the Board so that their views can be heard by the Board or individual directors, as applicable, and that appropriate and timely responses are provided to stockholders.
• We believe that all of the transactions described below met this policy standard at the time they occurred.
• Our Board, the Compensation Committee and management believe that the effective use of stock-based long-term incentive compensation is vital to our ability to achieve strong performance in the future.
• Our future success depends, in large part, upon our ability to maintain a competitive position in attracting, retaining and motivating key personnel.
• We believe that the Plan Amendment is essential to permit our management to continue to provide long-term, equity-based incentives to present and future key employees, consultants and directors.
• The Company believes that the backgrounds and qualifications of its directors, considered as a group, should provide a composite mix of experience, knowledge and abilities that will allow the Board to fulfill its responsibilities.

Industry Context

The company operates within the biotechnology and pharmaceutical industry, evidenced by its focus on clinical path developments, product commercialization, and the scientific background of its Chief Scientific Officer in pharmacology and diabetes. Its executive compensation practices are benchmarked against a peer group of U.S. and Israeli biotechnology companies. The recent strategic investment in Alpha Tau Medical Ltd., a company in the medical device/biotechnology sector, suggests a strategic expansion or diversification within the broader life sciences industry.

Comparison to Industry Standards

• Executive compensation is benchmarked against a peer group of U.S. and Israeli biotechnology companies, including ALX Oncology Holdings Inc., AN2 Therapeutics, Inc., Anavex Life Sciences Corp., Atossa Therapeutics Inc., aTyr Pharma, Inc., Chimerix, Inc., Compugen Ltd., Fulcrum Therapeutics, Inc., Immunic, Inc., Marinus Pharmaceuticals, Inc., MediciNova, Inc., Pluri Biotech Ltd., Rani Therapeutics, Inc., Relmada Therapeutics, Inc., Rezolute, Inc., Vistagen Therapeutics, Inc., vTv Therapeutics Inc. and Zevra Therapeutics, Inc.
• Base salaries for Named Executive Officers (NEOs) are targeted near the median of the range for executives in similar positions with comparable responsibilities, experience, and performance at peer companies.
• Equity incentive awards are designed to be competitive within the biotechnology industry, as well as with Israeli-based companies.
• Benefits and perquisites provided to NEOs, such as company cars and managers' insurance, are stated to be customary for executive officers by other companies similar in size and stage of development in Israel.

Management Changes

Corporate Governance

Related Party Transactions

• On April 24, 2025, Oramed Ltd., a 63% owned subsidiary, purchased 14,110,121 ordinary shares of Alpha Tau Medical Ltd. in a registered direct offering for approximately $36,900,000.
• Nadav Kidron, the Company's President, CEO, and Chairman, was designated to serve as a director on Alpha Tau's board on May 12, 2025, and will receive compensation from Alpha Tau for his service.
• Oramed Ltd. and Alpha Tau Medical Ltd. entered into a strategic investor relations and public relations services agreement, under which Oramed Ltd. will receive a non-refundable fee of $3,000,000 over three years and warrants to purchase up to 3,237,000 Alpha Tau shares.
• Dr. Miriam Kidron, Chief Scientific Officer and Director, receives compensation through a consulting agreement with KNRY, Ltd., and also has an employment agreement with Oramed Ltd.
• Nadav Kidron, President and Chief Executive Officer, receives compensation through a consulting agreement with Shnida Ltd., and also has an employment agreement with Oramed Ltd.

Stakeholder Impact

• Shareholders: Will vote on key corporate governance matters, including director re-elections and the expansion of the stock incentive plan, which could lead to share dilution. Their investment value is directly impacted by the company's financial performance and strategic decisions, such as the Alpha Tau investment.
• Employees and Executives: Directly impacted by the company's compensation policies, including base salary increases, discretionary bonuses, and long-term equity incentives. The proposed amendment to the 2019 Stock Incentive Plan aims to enhance the company's ability to attract, retain, and motivate key personnel.
• Directors: Their compensation structure has been updated, including annual cash fees and RSU grants, and new meeting attendance fees. The formation of an Investment Committee impacts their oversight responsibilities.
• Auditors: Kesselman & Kesselman's reappointment is subject to shareholder ratification, affecting their continued engagement with the company.
• Alpha Tau Medical Ltd.: Benefits from a significant equity investment from Oramed Ltd. and will receive strategic investor relations and public relations services, potentially enhancing its market visibility and capital access.

Next Steps

• Hold the Annual Meeting of Stockholders on August 19, 2025, for voting on the proposed matters.
• Report final voting results in a current report on Form 8-K filed with the SEC within four business days after the Annual Meeting.
• The Compensation Committee will continue to consider alternative models and equity vehicles for future equity-based grants.
• The company will continue to provide investor relations and public relations services to Alpha Tau Medical Ltd. for a three-year term.

Key Dates

Recommendation

Keywords

Oramed Pharmaceuticals, SEC filing, proxy statement, annual meeting, corporate governance, executive compensation, stock incentive plan, director re-election, auditor ratification, financial performance, Alpha Tau Medical, related party transaction, stock options, RSUs, Nasdaq, biotechnology, pharmaceuticals