FSD Pharma Inc., a publicly traded firm that once had aspirations of becoming a major producer of marijuana, on Tuesday said its board of directors had fired the company’s chief executive, Philadelphia-based Raza Bokhari.
In a news release, the company said its board “unanimously” voted to terminate Bokhari’s employment with the company “for cause.” Among findings by a special committee and a law firm, “only a few of the reasons for Dr. Bokhari’s termination are misconduct including breaching court orders, the improper issuance of shares, and attempts to misappropriate company funds in breach of his employment obligations.” It provided no further details.
The chief executive had already been on administrative leave following a May 14 shareholder meeting. Since then, the company said on Tuesday, the special committee had investigated “various concerns” regarding Bokhari’s tenure as CEO.
Bokhari, who had served as CEO since 2019, called the move an “attempt on their part to squeeze me out of a severance package of $30.2 million.”
“It is also an attempt to disparage me, to otherwise put a blemish on my demonstrated pristine track record as a serial entrepreneur and a job creator,” he said in an interview.
Bokhari is known as a mainstay in Philadelphia’s business community: a medical doctor by training, an investor, and an advisor to Temple University’s Fox School of Business.
He said Tuesday that he’d provided Canada-based FSD with the “strategic outlook” that eventually allowed it to become listed on the Nasdaq exchange in January 2020.
In July 2020, however, Bokhari announced that the company was getting out of the weed business. The physician-turned-entrepreneur said that other companies had outpaced FSD and that the company was saddled with $2 million worth of cannabis that it couldn’t sell.
Bokhari said FSD would instead focus on pharmaceutical research and development, The Inquirer reported at the time.
Later in 2020, Bokhari said Tuesday, he and other board members disagreed with what Bokhari described as the company founders’ “speculative” acquisition strategy.
Pharmaceutical development “is a serious business,” Bokhari said. “You have to be in it for the long haul.”
”Making speculative acquisitions,” he said, to “get temporary lift on our stock was not the outlook of our board that was in place at the time.”
A proxy battle ensued over control of the company. Bokhari said new board members chosen by the company’s founders — Anthony Durkacz and Zeeshan Saeed — took over in May, and Bokhari said he’d had no direct communication from the company between May 14 and Tuesday, when he was notified of the termination.
The board appointed Durkacz as interim CEO, and Saeed was reinstated as president.
“The company now has the benefit of a strong board of directors who bring with them highly relevant experience and knowledge,” Durkacz said in the release.