Is Forest Labs in line for a Carl Icahn makeover?

With its biggest product slated to lose patent protection next year and its aging CEO fighting the feds' effort to bar him from federal health programs, Forest Labs has now drawn the attention of billionaire activist investor Carl Icahn (photo). Icahn--who pushed Biogen Idec and Genzyme to undergo top-to-bottom transformations and made a fortune for himself along the way--is now fielding a slate of candidates to fill four of Forest's nine board positions.

"While we have not yet had a chance to meet with Mr. Icahn to discuss his ideas for the company, we welcome constructive input from all of our shareholders," Forest Chief Executive Officer Howard Solomon said in a statement.

Icahn, though, is not known for upbeat talks with the biotech CEOs he targets. And now that one of his funds has accumulated a 6.5 percent stake in Forest, he and some of the industry vets he has handpicked for the Forest board are likely to raise some serious issues with Forest's management.  

At the top of the list: Forest ($FRX) gets more than half of its revenue from Lexapro, which loses patent protection in 2012. And last April the company alerted shareholders that HHS wanted to bar Solomon from involvement in federal health programs--a major source of revenue for the company--following Forest's agreement to pay $313 million in 2010 to settle a federal fraud case. That case revolved around improper off-label promotions for three drugs.

- check out the release
- read the story from Reuters

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