Vita Life goes after former MD

Vita Life Sciences (ASX: VLS) is seeking recompense from its former managing director over what it says was a costly breach of agreement.

In a letter released this week to the Australian Stock Exchange, the company revealed it was investigating breaches of duty by Pang Seng Meng.

Pang, who lives in Singapore, resigned as managing director from the company on March 7.

It is understood the company was aware of the agreement breach at the time of his resignation.

Vita Life Sciences said it had employed lawyers to assist the investigation, which was focused on transactions that took place in Singapore.

"The financial impact of the rectification of the disputed transactions is yet to be determined but could be in the range of $3-$5 million," chairman Vanda Gould wrote in the letter.

"The relevant transactions have either been taken up in the company's accounts or are unlikely to lead to any material restatement of its financial position."

Gould is currently in Singapore and was unavailable for comment.

But a senior employee of Vita Life Sciences, who declined to be named, said the pursuit was in regard to a breach of agreement pre-dating the company's formation.

The staff member refused to say what the breach involved, but said it was to do with a breach of the agreed share sale arrangement at the time.

He said the company was prepared to go to court if Pang refused to come to the party.

Vita Life Sciences - a biopharmaceutical manufacturer and distributor - was formed and re-listed in 2000 after acquiring Singapore retail pharmacy group Vita Health and Tetley Medical, which later changed its name to Vita Medical.

Last month the company's accounts revealed a full-year revenue drop of 84 per cent, from $5.25 million to $830,000, blaming reduced sales forecasts in its key Asian markets.

The company also said at the time that despite the disappointing result it was set to begin Phase III trials of its Technegas generators for patients with breathing difficulties and was on track to receive FDA approval for sale of the generators in the United States.

Vita Life Sciences also said it was in advanced negotiations with an overseas investor for continued research and development of its diagnostic equipment.