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(Graphic: Business Wire)

Stocks in this article: VVUS

Please replace the release with the following corrected version due to certain revisions.

The corrected release reads:


First Manhattan Co., the beneficial owner of approximately 9.9% of the outstanding shares of VIVUS, Inc. (Vivus) (NASDAQ: VVUS), today issued a letter to Vivus' stockholders.

The full text of the letter follows:

July 8, 2013

Dear Fellow Vivus Stockholders:

Vivus’ Annual Meeting of Stockholders is only one week away. We at First Manhattan Co. strongly believe there is need for immediate and complete change in Vivus’ board and CEO in order to save the company.

Warren Buffett has written much about his experience on public company boards and we believe his wisdom is worthy of consideration by all shareholders: “In addition to being independent, directors should have business savvy, a shareholder orientation and a general interest in the company. The rarest of these qualities is business savvy—and if it is lacking the other two are of little help.” 1

There is an abundance of evidence to suggest that Vivus’ sitting board lacks all the qualities Buffett has emphasized – independence, a shareholder orientation, a general interest in the company, and “business savvy.” The sitting board has presided over massive destruction of shareholder value due to its poor business judgment.

The following charts speak for themselves.

We urge you to support all nine of our nominees. If you have previously voted on the gold card, you can change your vote simply by voting on the WHITE card today. Even if you do not vote for all of our nominees, you should vote our WHITE proxy by mail, internet or phone.

The sitting board and CEO committed the fatal flaw of failing to secure a pre-launch large pharma commercial partner for Qsymia. Securing a commercial partner is a decision that did not require much “business savvy.” In fact, it just required a bit of common sense since no small company has ever successfully launched a blockbuster drug into the primary care market. Both of our obesity competitors, Arena and Orexigen, got it right on the commercial partnership, but Vivus’ sitting board and CEO got it wrong. Consequently, Vivus shareholders have a failed launch and a company that is hemorrhaging cash, while Arena and Orexigen have a clear path toward profitability.

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